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Lordstown Motors ( RIDE ) Q2 2022 Earnings and Production

Lordstown Motors ( RIDE ) Q2 2022 Earnings and Production
Written by boustamohamed31

Workers install door hinges to the body of a prototype Endurance electric pickup on June 21, 2021 at the Lordstown Motors assembly plant in Ohio.

Michael Weiland CNBC

Launch an electric truck into battle Lordstown Motors on Thursday reaffirmed plans to begin commercial production of its first vehicle this quarter and to roll out first customer deliveries by the end of the year.

Lordstown CEO Edward Hightower said production of the Endurance pickup would be slow and largely dependent on capital availability. He said the company expects to produce only about 500 vehicles by early 2023 — an extremely slow production ramp-up by industry standards.

CFO Adam Kroll said Lordstown will need to raise “significantly more capital” to produce the initial 500 Endurance electric pickups, although the company predicts less money will be needed than previously thought.

Shares of Lordstown jumped as much as 27% in Thursday morning trading before falling to around $3.15 a share, up 7.3%. The stock is down about 15% this year and 58% from its 52-week high of $8.93 a share. The company’s market capitalization is approximately $740 million.

The company said it would need to raise between $50 million and $75 million this year, down from previous expectations of $150 million. Lordstown will need additional capital in 2023, Kroll said.

Lordstown, next to it second quarter resultssaid its cash balance of $236 million at the end of the first half of the year was above internal expectations and widening the cash-strapped company’s runway — but not enough to fund production.

The company reported its first quarterly operating profit of $61.3 million for the period ended June 30, although it did not deliver any vehicles due to gains related to the sale of its Ohio factory to a contract manufacturer. Foxconn. The profit included a $101.7 million gain on the sale, as well as an $18.4 million operating expense recovery from Foxconn.

Lordstown and Foxconn announced plans in November for the Taiwan-based company to buy the facility and an agreement for the company to manufacture the stalled startup’s Endurance pickup truck. The deal was announced as Lordstown needed cash, delaying production of its pickup and was engulfed in controversy after the resignation of its CEO and founder Steve Burns earlier in the year.

Lordstown, who went public in October 2020, was among a group of electric vehicle startups that went public through special purpose acquisition companies, or SPACs, since the start of the decade. The deals were initially welcomed by Wall Street and investors controversy, product delays, lack of funding and management changes sent shares of most companies plummeting.

Lordstown was originally expected to be among the first, if not the first, company to launch an electric pickup, with initial estimates as early as 2020. However, General Motors, Rivian Automotive and Ford Motor all beat the company to market after internal problems and delays with Endurance.

Ford’s electric F-150 is precisely positioned to compete with the Endurance for the commercial pickup market. Ford’s electric F-150 pickup starts about $23,000 less than the Endurance, plus it carries first-mover advantage and the backing of a well-funded company.

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