YOUNGSTOWN, Ohio — Just one week after Lordstown Motors announced it could go under within the next year, the company announced Monday its top two executives resigned as problems at the Ohio electric truck startup continue to mount.
CEO Steve Burns and CFO Julio Rodriguez stepping down caused shares to already dip down 40% this year, tumbling 16% at the opening bell.
The company, located southeast of Cleveland, gave no reason for the resignations.
Angela Strand, who is currently the managing director of advisory firm Strand Strategy, will take over as lead independent director until a permanent CEO is found, according to Lordstown.
Beck Roof, a public accountant who has experience with businesses like Saks Fifth Avenue and Aceto Corp, will serve as interim CFO.
Lordstown Motors said Monday that it has hired an executive search firm to help find permanent replacements for the roles.
In a quarterly regulatory filing, the company said that the $587 million it had on hand as of March 31 isn’t enough to begin commercial production of its full-sized electric pickup, called the Endurance.
This is a far fall from where the company stood in January when President Joe Biden signed the “Buy American” executive order. The order included the intiative to convert the entire U.S. federal fleet to electronic vehicles by 2025, Lordstown Motors’ shares traded 5.2% higher at $24.4 at one point.
Also on Monday, the company responded to a scathing report in March from the short-selling research company Hindenburg Research, which question the number of pre-orders the company claimed to have received for its marquee Endurance vehicle.
Lordstown said it’s independent investigation found that the vast majority of the Hindenburg report was unsubstantiated.
However, it acknowledged that one potential buyer that made a large number of preorders doesn’t appear to have adequate resources to make those purchases. Other preorders appear too vague or weak to be relied on.
Lordstown has struggled this year, starting in January when an Endurance pickup truck prototype caught fire 10 minutes into its initial test drive in Michigan.
Then the company failed to pay $570,000 in real estate taxes due in early March. There was also the filing of four potential class-action lawsuits by investors who claim they have been defrauded. The lawsuits filed were mostly based on the Hindenburg report.