The CEO and chief financial officer of an Ohio-based maker of electric vehicles (EVs) have stepped down from their executive positions after a board of directors review of allegations concerning inflated preorder figures.
A June 14 press release from Lordstown Motors Corp., maker of the electric Endurance pickup truck, refers to the moves as “changes to its executive management team as the company begins to transition from the R&D and early production phase to the commercial production phase of its business.”
However, the announcement of the change was made the same day another press release provided information on a report and investigation by a special committee of the Lordstown Motors board that was commissioned to look into allegations by stock short selling firm Hindenburg Research.
That news release says the committee found that allegations pertaining to production date targets and Lordstown Motors’ technology were “in significant respects, false and misleading.”
But the committee also found that under the watch of the former executives, some future business described as preorders were instead linked to “so-called ‘influencers’ or other potential strategic partners that committed to attempt to secure preorders from other entities, but did not intend to purchase Endurance trucks directly.”
The committee also found that “one entity that provided a large number of preorders does not appear to have the resources to complete large purchases of trucks. Other entities provided commitments that appear too vague or infirm to be appropriately included in the total number of preorders disclosed” by the prior executive team.
The setback follows another in the EV space last year, when short sellers identified EV commercial truck maker Nikola as having engaged in questionable practices regarding the state of its technology and status of its order book.
Shortly after the scrutiny of Nikola, waste and recycling company Republic Services canceled a 2020 agreement it had made to purchase as many as 2,500 collection vehicles from the EV producer.