Hindenburg is best known for being the firm that called Nikola an “intricate fraud”, which led to the departure of the company’s founder and eventual probes by several regulatory bodies.
The Lordstown report alleges that the company is an “EV SPAC with no revenue and no sellable product” which has “misled investors on both its demand and production capabilities”. Hindenburg takes specific exception with the company’s pre-orders, stating that their “conversations with former employees, business partners and an extensive document review show that the company’s orders are largely fictitious and used as a prop to raise capital and confer legitimacy.”
The report points out several examples:
- For example, Lordstown recently announced a 14,000-truck deal from E Squared Energy, supposedly representing $735 million in sales. E Squared is based out of a small residential apartment in Texas that doesn’t operate a vehicle fleet.
- Another 1,000-truck, $52.5 million order comes from a 2-person startup that operates out of a Regus virtual office with a mailing address at a UPS Store. We spoke with the owner who acknowledged it won’t actually order any vehicles, instead describing the “pre-order” as a mere marketing relationship.
- Yet another firm that is supposedly set to buy 500 trucks from Lordstown told us: “…The letters of interest are non-binding. It’s not like you’d obligate yourself to a pre-order or that you would contractually bind yourself to buying this truck. That’s not what they are.”
- Lordstown CEO Steve Burns has called these arrangements “very serious orders”. The actual customer agreements, which we present for the first time today, require no deposit and are non-binding. Many of the supposed customers do not operate fleets nor do many have the means to actually make the stated purchases.
- One company rep that committed to buy 40 trucks through Climb2Glory told us: “…I’m not committed to anything, not to buying a single vehicle. I committed to consider buying vehicles. I’d have a lot of questions before I commit to anything.”
- Others had similar remarks. “The commitment of that size (15) is totally impossible,” a representative for the City of Ravenna told us about its pre-order. We document numerous other “customers” that disclaim any intent to actually purchase vehicles.
The report also alleges that “a small consulting group called Climb2Glory was paid to generate pre-orders” for Lordstown. It also says that “…in January 2021, Lordstown’s first street road test resulted in the vehicle bursting into flames 10 minutes into the test drive.”
Hindenburg also released a video in a series of Tweets:
We will update this piece when Lordstown responds to the allegations.
Fri, 03/12/2021 – 08:32
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Author: Tyler Durden