Lordstown reveals SEC inquiry, insists it will be mass-producing electric trucks in September
Ohio-based Lordstown Motors started its first-ever call with investors, as a publicly traded company, with a strange twist: It is being probed by the U.S. Securities and Exchange Commission
The SEC inquiry stems from a report issued by the activist short-seller Hindenburg Research, claiming that Lordstown has been faking orders for its Endurance electric truck, and that the truck is actually three or more years from production.
Although Lordstown’s chief executive, Steve Burns, said he couldn’t address questions about the inquiry, the CEO spent much of the call asserting that the company is indeed ready to produce the Endurance at a mass-production rate.
And there were some surprises. One of them: that the Endurance, with its industry-first in-wheel hub motors, only has about 20,000 miles of real-world testing at this time.
Lordstown Endurance wheel hub motor
He did say that the company has about 200,000 miles on the motors themselves. But to put this into perspective, Fiat Chrysler (Stellantis) told us last year that it put about 1.5 million development miles on the plug-in hybrid system set to go in its Wrangler and other vehicles starting this year. Porsche did about 3.7 million pre-production development miles on its Taycan. And about a year and a half before it started production of the Model S, Tesla reported that its modest fleet of Tesla Roadsters, helping prove its battery and propulsion tech, had already covered more than 8.5 million real-world miles.
It’s more about durability testing, Burns insisted. While he didn’t downplay the fire that had been referred to in Hindenburg’s report, he did note that it was on a development mule, not a prototype.
“In this business of electric vehicles, you know, it does happen; thermal has really got to be carefully watched,” said Burns, adding that the company has now turned to third-party testing for the battery so that the company doesn’t miss anything.
The company claims to be on track to build 57 beta prototypes this month that will be used for durability, crash-testing, and validation purposes. And then, it says, by September it claims it will be able to ramp up at a rate that it took Tesla many months to achieve with Model 3.
“We expect to make an Endurance every six minutes when we start production this year, and work our way up to an Endurance every four minutes next year,” said Burns.
“In my 15 years in the business I haven’t seen anybody get this far, except for of course Tesla,” he said, reiterating that the first Endurance models won’t be hand-built. “The first Endurance that comes off the line in September is fully automated—one every six minutes,” he said.
Rivian R1T pre-production
Burns says that the production schedule will make the Endurance the first mass-produced full-size electric pickup truck in the world—a potentially misleading claim on its own as Rivian R1T deliveries are slated to start this summer. And he said that the 800,000 square-foot propulsion line, set to build battery packs and electric hub motors in-house, will be the second largest of its kind in the U.S.
Because Lordstown intends to initially sell only to fleets, it’s a different process estimating sales and demand, according to Burns, and there will be much less guesswork with its follow-up models.
“At this stage our evolution, the arrangements must be conditional because we won’t have the product until later this year,” said Burns, using more restrained language about orders than he has in some media appearances, and noting that they have arrangements with fleet-management companies for 20,000 of its Endurance trucks. The company earlier this year said that it had 100,000 non-binding pre-orders for the truck.
Lordstown recently obtained its first license to sell direct, in California, and opened its first sales and service center in Irvine, California, that also housed the company’s design team and software work.
Although the subject of an SEC probe, Lordstown confirmed another surprise: that It has the added assurance of a $250 million DOE ATVM loan. It had reported that it was at the “due diligence” phase in January, and made no confirmation that it will seek the funds.
“It’s almost like a line of credit we can draw down as needed…we don’t know if we will,” said Burns, who called it a nice validation of the company and suggested that they might use it down the line to help pull forward its third vehicle, a full-size SUV based on the pickup.
Press conference for electric RV – Lordstown Motors plant
Lordstown also confirmed that their next vehicle, an RV to be marketed in conjunction with Camping World, will be an all electric four wheel drive high-top van, with a target range of up to 350 miles. It sees plenty of other use cases for a large van, and it plans a demonstration version of that this summer.