A market analyst said the once-promising EV startup, which filed for bankruptcy in June, is "just as doomed as ever" despite the purchase.
Lordstown Motors founder and former CEO Steve Burns is buying back some of the company’s assets for $10 million.
An SEC filing said the sellers entered into an asset purchase agreement with LAS Capital and Burns, as guarantor of certain obligations of LAS Capital.
Lordstown was once considered one of the rising stars of the electric vehicle sector. Its Endurance all-electric pickup truck was announced with 100,000 supposed pre-orders. That number was challenged by Hindenburg Research, which alleged the company was inflating the Endurance’s pre-orders.
Burns resigned as CEO in 2021 after an internal investigation found he had in fact inflated order estimates. Julio Rodriguez, who was serving as Lordstown’s CFO at the time, also left the company.
It remains to be seen what assets Burns will be acquiring from Lordstown, as the company’s plant complex in Ohio is owned by Foxconn. Per the SEC filing, however, Burns’ entity, LAS Capital, “agreed to acquire specified assets of the selling entities related to the design, production and sale of electric light duty vehicles focused on the commercial fleet market.”
Guidehouse Insights principal analyst Sam Abuelsamid said Lordstown, which filed for bankruptcy and sued Foxconn, its main investor, in June, will still be unable to recover despite Burns’ recent moves.
“It’s just as doomed as ever," Abuelsamid said. "I have no more confidence that Lordstown will gain any market traction than I did yesterday… There’s only soft tooling there. Maybe they could build a couple hundred more trucks, but that’s it. And nobody’s going to buy them."