GM Sells Stake In Embattled EV Startup Lordstown Motors
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GM has sold its stake in embattled EV startup Lordstown Motors as the Ohio-based company seeks additional funding to put its Endurance pickup into production.
GM received 7.5 million shares of Class A common stock in Lordstown Motors in exchange for selling its Lordstown Assembly plant to the company at a discounted rate back in 2018. Speaking to The Detroit Free Press this week, GM spokesman Dan Flores confirmed the automaker sold its stake in Lordstown Motors in the fourth quarter of last year, which was equivalent to less than five percent of the company.
“We were a small investor in the company,” Cain told the newspaper. “The goal was to help facilitate the sale of the plant and the restart of production.”
Lordstown Assembly exterior in 2012
An analyst that spoke to The Detroit Free Press said GM had sold the assembly plant to Lordstown in order to appease the demands of former U.S. President Donald Trump for the automaker to keep the plant open. Lordstown also agreed to sell GM all of the regulatory carbon credits it received as a result of selling the battery-electric Endurance for the first three years of production at a 75 percent discount – an arrangement that never reached fruition amid constant production delays for the electric pickup truck.
Lordstown Motors has become ensnared in controversy since GM first became involved in 2018. A short-seller report published in early 2021 accused the company of misleading investors with regard to real-world demand for the Endurance pickup, as well as its production capabilities. The report led to the resignation of co-founder and CEO Steve Burns, who has since been replaced by former Icahn Enterprises CEO Daniel Ninivaggi.
Lordstown Motors is currently in discussions with Foxconn to sell the spawling former GM assembly plant to the Taiwan-based iPhone manufacturer. In its Q4 financial earnings report, which was published earlier this week, the company said it had already received $150 million in equity and down payments from Foxconn as part of the $230 million deal. Lordstown will eventually lease space within the assembly plant from Foxconn to produce the Endurance pickup.
Lordstown Motors reported losses of $410 million in 2021 and said this week that “raising additional capital in the near term is critical to the successful launch of the Endurance,” and the execution of its operating plan.
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They should of done that at the beginning of last year.
Lordstone is stupid. I wouldn’t buy one. I’m still wary of all these EV startups.
The bubble is bursting.
The EV cult ends now.
One power plant engineer stated they would have to bring a new Nuclear Power Plant online every month for the next ten years to replace 50% of gasoline use with electricity.
LOL. How did GM sell something that is worthless? Better question, how did GM convince anyone that the worthless stake had value?
And they quietly cancelled Marketplace on both my 2019 Chevy’s. Assholes!
Not sure what they were thinking. Between these guys, Rivian and Alas and ..(add name here)… its definitely a no win situation. All the traditional players have commercial sales teams throughout world. Any commercial fleet captain will look no further than it’s Ford , GM, Ram, Toyota, etc etc sales rep for new vehicle, charging system, technical info and piles of sale info etc. No one else other than maybe Tesla is set up to service this crew. Even Tesla with its high bed walls can’t fair well in such a market.
Maybe these guy should cut a deal with the post office… like there original plan
Check with the State of Wisconsin to see how reliable Foxconn is!
With an electrical engineer relative owning a 2012 Volt, a Tesla-owning neighbor and personal/professional Allison EP40/EP50 engineering and technical study experience I have become a supporter of EV technology. EVs currently are attractive in low rolling resistance, stop-go duty cycle operation, light vehicle applications within close proximity of Tesla Supercharge locations.
Until an EV can achieve a single-charge 450 mile range, duration for a full recharge is reduced to 5 minutes and the People’s Republic of China (PRC) Lithium sourcing difficulty is solved I plan to remain an interested observer of the national EV Finger-Pointing and Litigating Industry. Oh, and I will also remain content with my 450 mile range, 5 minute refueling duration, $1000.00US 2004 Impala LS with my GM Tech II with my GM Service Manual publications.