Lordstown Motors' shares tank after WSJ reports DOJ investigation
Detroit — Lordstown Motors Corp. shares declined sharply Friday after the Wall Street Journal reported that the electric-truck maker is under investigation by the Justice Department.
Citing anonymous sources, The Journal reported that the investigation into the electric-vehicle startup "is being handled by the U.S. attorney’s office in Manhattan and is in early stages."
Shares in the northeast Ohio-based EV maker dropped 17% after the report hit. It opened Friday at $10.34 a share and hit a low of $8.56. Lordstown's stock closed Friday at $9.29, down 10.8%. The Securities and Exchange Commission also has started an investigation into the company, the startup previously confirmed.
In a statement Friday afternoon, company spokesman Ryan Hallett said: "Lordstown Motors is committed to cooperating with any regulatory or governmental investigations and inquiries. We look forward to closing this chapter so that our new leadership — and entire dedicated team — can focus solely on producing the first and best full-size all-electric pickup truck, the Lordstown Endurance."
The news comes after several rough months for Lordstown as it tries to rewrite its narrative, moving from an embattled company to one that's pushing forward with plans to start producing its electric Endurance pickup in September.
Lordstown's troubles started with a March short-seller report claiming the startup misled investors. Then came a regulatory filing with Lordstown warning it may not survive into next year without additional funding.
Last month, former CEO and founder Steve Burns resigned following an internal board review of the short-seller that found "inaccurate" disclosures about pre-production orders.
A new team of executives recently opened up Lordstown's northeast Ohio assembly plant to investors, media and analysts to push a different story: Lordstown has no distractions and is ready to make electric trucks.
Lordstown acquired its sprawling assembly plant from General Motors Co. in 2019. The Detroit automaker has backed Lordstown with in-kind and cash contributions.