Lordstown has 'binding orders' for first two years of production, exec says

DETROIT -- Lordstown Motors Corp has "firm" and "binding" orders for the first two years of production of its electric pickup truck, the startup's president said on Tuesday, sending shares up a week after saying it had no binding orders for the vehicle.

"Currently, we have enough orders for production for '21 and '22," President Rich Schmidt said at an Automotive Press Association event in Detroit. "Those are firm orders we have for those two years."

"I don't know the exact facts of the legal aspect of that, but they are basically binding orders that are committed here in the last two weeks, reconfirmed orders," he added, when asked if they were binding orders. "They're pretty solid, and I think that's on the light side or conservative side."

In March, Lordstown's shares slumped after investment research firm Hindenburg Research disclosed it had taken a short position on the stock, saying the company had misled consumers and investors about its pre-orders for the Endurance truck that Lordstown initially said were worth $1.4 billion.

The Ohio company subsequently said the orders were not binding and on June 8, when it warned it was running out of cash, disclosed in a regulatory filing it had no binding orders or commitments from customers.

On Monday, Lordstown announced that CEO Steve Burns and its CFO had resigned and acknowledged it overstated the quality of pre-orders in the trucks.

Shares of Lordstown Motors closed up 11 percent at $10.31 on Tuesday.

The U.S. Securities and Exchange Commission has asked the company for information related to the truck pre-orders. Schmidt declined to comment when asked for an update on the SEC inquiry on Tuesday.

Schmidt also said Lordstown will seek additional funds from General Motors and other early investors. GM owns a small stake in the startup.

In a statement, GM said, "we are comfortable with our current relationship with LMC but we are willing to listen to proposals that make sense for both parties.”

Lordstown's plant can currently build at a rate of 20,000 vehicles per year without more investment, and the additional funds would allow it to expand beyond that level, said Schmidt, adding that the company has $400 million in the bank.

Angela Strand, who took over as executive chairman on Monday after Burns' resignation, said in an opening statement during the webcast that the company's plan remains to start limited production of the truck in late September.

The Endurance will be designed as a work truck and start at $55,000, Schmidt said.

He made a pitch for investors to put capital into Lordstown before it begins production of the truck, saying those who wait will have "missed the big jump."

Ford Motor Co is also targeting commercial customers with the electric version of its F-150 truck, the F-150 Lightning, which will launch next spring. A "commercial base" version will start at just below $40,000 before tax credits, while an XLT model that aligns with the best-selling gas version will start at almost $53,000