Lordstown Motors continues to stumble. The beleaguered electrical car startup is now being investigated by the Division of Justice, along with an ongoing investigation by the Securities and Alternate Fee.
The investigation, first broke by the Wall Street Journal on Friday, remains to be in its early levels, in keeping with unnamed sources. It’s being performed by the U.S. lawyer’s workplace in Manhattan.
“Lordstown Motors is dedicated to cooperating with any regulatory or governmental investigations and inquiries,” an organization spokesperson informed TechCrunch. “We stay up for closing this chapter in order that our new management – and whole devoted group – can focus solely on producing the primary and greatest full-size all-electric pickup truck, the Lordstown Endurance.”
The probe is simply the most recent in a collection of woes for the startup, which lately stated it needed to minimize manufacturing volumes for its debut electrical pickup, Endurance, by half — from round 2,200 autos to 1,000. Just some weeks after it made that announcement, there adopted information of a company shakeup: the resignation of founding CEO Steve Burns and CFO Julio Rodriguez. Burns began the corporate as an offshoot of his earlier startup, Workhorse Group.
Lordstown had a robust begin, with investments from Normal Motors that helped it buy a 6.2-million-square-foot manufacturing unit from the main automaker in late 2019. Lordstown made constructive headlines final August, when it introduced it might go public by way of a merger with a particular objective acquisition firm (SPAC). The deal injected the EV startup with round $675 million in gross proceeds and skyrocketed its market worth to $1.6 billion. Lower than a 12 months later, Lordstown informed the SEC that it doesn’t have enough capital to fabricate Endurance.
Then, in March, the short-seller agency Hindenburg Analysis launched a report disputing the corporate’s claims that it had booked 100,000 pre-orders for the electrical pickup. It wrote that “intensive analysis reveals that the corporate’s orders seem largely fictitious and used as a prop to boost capital and confer legitimacy.” The SEC opened its investigation within the wake of those accusations.
The WSJ story is unclear on the scope of the inquiry and the corporate declined to supply particulars. TechCrunch will replace the story if it learns extra.