Does it have binding orders or not have binding orders? That is the question — for Lordstown Motors. Whether ‘tis nobler in the mind to suffer the slings and arrows of outraged investors, or to take a stab at assuaging a sea of shareholders seeking the truth — does nascent EV maker have real orders?
No, the company said Thursday in a filing with the U.S. Securities and Exchange Commission. This is after one executive said “Yes” earlier in the week.
“(A)lthough these vehicle purchase agreements provide us with a significant indicator of demand for the Endurance, these agreements do not represent binding purchase orders or other firm purchase commitments,” the company said in the filing.
The filing came after Lordstown’s president, Rich Schmidt, told reporters during a meeting of the Automotive Press Association Tuesday the EV maker had orders to carry it through May 2022.
What the deal with the orders?
It was the veracity of the orders the electric truck maker’s previous CEO Steve Burns, who resigned a few days before he was scheduled to meet with the APA, was taken to task about by short-sellers Hindenburg Research.
In the scathing account, the firm accused the company of exaggerating the number of orders it had for its vehicles. In fact, many were described as “fake” orders.
Dispelling that notion appeared to be at or near the top of the list of things to do for President Rick Schmidt, who said the company had enough “binding” orders to keep it running for all of 2021 and through May 2022. “Those are firm orders we have for those two years,” he said.
“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 said. “They’re pretty solid, and I think that’s on the light side or conservative side.”
Schmidt also confirmed production would begin, as planned, at the end of September with the first production-ready vehicle set to be delivered in 2021.
In addition to clarifying Schmidt’s remarks, the company noted it was moving its annual meeting that was supposed to be held June 17 to Aug. 19, and that stockholders of record at the close of business July 1 may vote and participate.The company also issued a press release Thursday announcing the hiring of former General Motors executive John Whitcomb to “develop the strategic business model for Lordstown Motors’ sales and service footprint.” He will assume the newly created role of vice president global commercial operations effective June 21.