Bankrupt Lordstown Motors to sell remaining assets to ex-CEO

Bankrupt electric vehicle startup Lordstown Motors plans to sell its remaining assets to an investment firm led by founder and original CEO Steve Burns, an SEC filing made on September 29 reveals.

The investment firm, LAS Capital, which also counts former Lordstown Chief Financial Officer Julio Rodriguez as a major shareholder alongside Burns, has agreed to purchase the assets for $10 million in cash.

Both Burns and Rodriguez left Lordstown in 2021 following an internal investigation that found inaccuracies concerning claimed pre-orders for the Lordstown’s debut vehicle, the Endurance full-size pickup truck.

Burns is also the founder of Workhorse Group, a company that manufactures electric commercial vans and trucks, as well as drones.

Lordstown Motors CEO Steve Burns in assembly plant

Lordstown Motors CEO Steve Burns in assembly plant

The assets LAS Capital has agreed to purchase include certain intellectual property, as well as manufacturing equipment for batteries and motors. The plant that built the Endurance, a former General Motors plant located in Ohio, was sold by Lordstown to Foxconn in 2021 in a deal that was to see Foxconn build the Endurance as well as co-developed future models for Lordstown under contract.

The asset sale to LAS Capital is due to be completed by the end of October, should it receive court approval.

The Endurance, which features in-wheel motors but lackluster performance compared to rival electric trucks, started production in late 2022. However, it was only in production for a few months, resulting in only a handful of examples being built. Production was initially halted due to an electrical issue being found in the truck, and later due to the cost of building the truck becoming much higher than its selling price. Lordstown subsequentially filed for Chapter 11 bankruptcy protection in June.

Prior to filing for bankruptcy protection, Lordstown attempted to form a new deal with Foxconn to jointly develop a next-generation vehicle to be built at the Ohio plant. However, the deal fell through in May after Foxconn pulled out.

Source link