DETROIT, Lordstown Motors Corp, which previously warned it needs to raise additional funding, hung the “open for business” sign on its northeastern Ohio plant on Wednesday, saying it was in talks to build vehicles for other automakers or lease space in the factory.
Shares of the electric vehicle startup, which also said it will begin limited production of its Endurance pickup truck in late September, rose 6.1% in after-hours trading.
“We are exploring multiple partnership constructs. That includes contract manufacturing, that includes licensing,” Chairwoman Angela Strand said on a conference call with analysts. “We’re discussing with multiple (automakers) who are interested in exploring how they can leverage the assets that we have.”
“This is a critical, strategic pivot for us,” she added. “A decision that we believe will lead to significant new revenue opportunities.”
Lordstown, which also on Wednesday announced a second-quarter loss, said its plant in the northeastern part of the state is ready and that retooling of stamping, assembly, body and paint shops has been completed. It also said the electric battery line is fully commissioned.
Lordstown will begin shipping the Endurance to select early customers in the first quarter of next year, followed by wider commercial deliveries in the second quarter, she said. Production will increase steeply in the second half of 2022.
Strand said while Lordstown will initially target commercial customers, the Endurance also will appeal to consumers.
Lordstown President Rich Schmidt said the Endurance uses only 30% of the plant’s 6.2 million square feet, so there is room for others to build vehicles there or for Lordstown to build them. Other options could include selling batteries or EV platforms to other automakers, he said.
Lordstown on Wednesday said it lost just over $108 million, or 61 cents a share, in the second quarter.
The company had $366 million in cash and equivalents at the end of the quarter, and expected to end the third quarter with liquidity of between $225 million and $275 million excluding any funds from a capital raise.
Last month, Lordstown said a hedge fund had committed to purchasing up to $400 million of the startup’s shares over a three-year period. Executives said on Wednesday that Lordstown was exploring other financing options, including debt.
Lordstown also will begin earning environmental credits it can sell to other automakers, interim Chief Financial Officer Becky Roof said. It has a deal with minority shareholder General Motors Co that allows the No. 1 U.S. automaker to buy those credits during the first three full production years at a discount to fair market value.
Lordstown faces heightened scrutiny from federal prosecutors in Manhattan and officials with the U.S. Securities and Exchange Commission related to its merger with a special-purpose acquisition company (SPAC) and statements it previously made about preorders for its vehicles.
In March, Lordstown’s shares slumped after Hindenburg Research disclosed it had taken a short position on the stock, saying the company had misled investors.
An internal investigation into Hindenburg’s claims in June found that Lordstown had overstated the quality of preorders. Lordstown also announced at the same time the resignation of founder and chief executive Steve Burns, the company’s largest shareholder.