The Hindenburg may have caught fire, but Hindenburg Research prefers to smoke electric vehicle startups with a high success rate. Its allegations against Nikola Motor Company made Trevor Milton resign, and GM give up the deal they had established before Hindenburg’s report. Kandi was another target. The latest report from Hindenburg Research focuses on Lordstown Motors.
The extensive report brings much more than just the prototype fire about which we talked in January. On February 12, we were the first to publish the images of the prototype after the blaze. According to Hindenburg Research, Lordstown is a “mirage” created by fake orders.
Hindenburg Research reports that Lordstown asked multiple companies to make Endurance reservations without any intention actually to buy any of them. One of these companies would be “a 2-person startup that operates out of a Regus virtual office with a mailing address at a UPS Store.” It would have ordered 1,000 trucks, in a total of $52.5 million.
Some of these orders would have been arranged by Lordstown’s CEO, Steve Burns. Former employees and people that worked with him would have accused the executive of being a “con man.” Some others would also have compared him to a “PT Barnum” figure, a reference to the American entrepreneur pictures by the movie “The Greatest Showman.”
Former senior employees from Workhorse also told Hindenburg Research that Burns was ousted from that company despite being allowed to resign. He would have missed deadlines and wasted research and development money. A few months after that, he founded Lordstown Motors.
Another sign that there would be something wrong with Lordstown is that “executives and directors have unloaded about $28 million in stock” soon after the company went public through a SPAC merger.
Hindenburg Research also highlighted that the company would be having issues that will probably postpone production to at least three years from now. Lordstown would have promised to deliver the first units of its Endurance electric pickup truck in September 2021.
Needless to say, Hindenburg Research is shorting Lordstown Motors and left 21 questions it thinks the company needs to answer. You can see them and the full report on the company’s website.