Update: Lordstown Motors Shares Tumble as Company Halts Production, Begins Recalls
LORDSTOWN, Ohio – Shares of Lordstown Motors Corp. dropped 11.38% during trading Thursday after the company said it has temporarily stopped production and deliveries of its inaugural electric pickup, the Endurance, and initiated a recall of the vehicle.
“The team is diligently working with suppliers on the root cause analysis of each issue and potential solutions, which in some cases may include part design modifications, retrofits, and software updates,” the company stated in a news release.
Lordstown Motors stock, which trades on the NASDAQ under the ticker RIDE, fell sharply in midday trading after investors digested the news. At 1 p.m. RIDE stock had plummeted 14.2% to $1. 06 per share. Lordstown’s share price closed at $1.09 per unit Thursday.
Meanwhile, Lordstown Motors has filed paperwork with the National Highway Traffic Safety Administration to voluntarily recall the Endurance to address a specific electrical connection issue that could result in a loss of propulsion while driving.
Lordstown is working with its supplier network to implement a corrective action that the company believes will address this issue, Lordstown Motors said. The recall will affect 19 vehicles that are either in the hands of customers or being used internally by Lordstown Motors. Vehicles waiting for shipment and vehicles in process at the manufacturing plant will also be retrofitted with the corrective action once components are available.
“While our experienced team has made significant progress in addressing the underlying component and vehicle sub-system issues affecting the Endurance build schedule, we remain committed to doing the right thing by our customers and to resolve potential issues before resuming production and customer shipments,” said Edward Hightower, Lordstown Motors’ CEO and president.
Lordstown Motors said Thursday it would release its fiscal year 2022 financial results before markets open March 6. The company will then host a conference call at 8:30 a.m.
The company intends to provide a more detailed update on the status of these matters on its upcoming earnings call.
Published by The Business Journal, Youngstown, Ohio.