They recently shared that they have pre-sold 100,000 trucks.
Some of the “buyers” do not operate fleets and are based out of apartments.
A company was paid to generate pre-orders in order to boost investor confidence.
The willingness of investors to dumps hundreds of millions, billions even, of dollars into the next EV start-up company. The goal is massive returns as have been experienced by those who invested in Tesla stocks early on. The pressure to generate interest in order to get these investments has, apparently, put Lordstown in a “bad” position. According to a report, they are not who they say they are.
Nikola was also caught in a similar situation a while back. But for this round, it’s Lordstown’s fake orders, undisclosed production hurdles, and other issues. Hindenburg Research has found that the EV company has created the illusion of supply and demand through various fake pre-orders.
The study shows that, of the apparent 100,000 pre-orders, as boasted by the Lordstown CEO, most were done by questionable companies that do not operate fleets and/or are based out of virtual offices. In fact, owners of these small companies were contacted and they revealed that they “won’t actually order any vehicles, instead describing the “pre-order” as a mere marketing relationship.”
Furthermore, former employees have described Lordstown Founder & CEO Steve Burns “as a “con man”, or a “PT Barnum” figure”. One senior employee shared with Hindenburg Research they witnessed “more questionable and unethical business practices than they had seen in their entire career.”
The element that we find most “amusing” in the report is that the vehicle’s first street test went up in flames. Only ten minutes after setting out, the vehicle burst into flame. Details of the incident were obtained thanks to the FOIA.
The report is worth a read especially if you have or were thinking about investing in the company.