Three years have passed since General Motors (GM) announced the sale of its Lordstown, Ohio plant to electric vehicle builder Workhorse Group Inc. Since then, the fate of the plant and its workers had been in limbo between misfortunes, overreachings, and mistakes as GM, Workhorse, and DiamondPeakHoldings juggled with the company, hashing out the details of the sales and production of electric trucks. But now, some hope as the EV startup has finally begun production of its all-electric Endurance pickup.
Lordstown Motors' Rocky Beginnings
General Motors' former Lordstown, Ohio assembly plant had been dormant since March 2019. The company announced in November 2018 that it would shut down the facility. That decision was based on the declining demand for passenger cars and in North America accompanied by a growing demand for trucks and SUVs. The shift in consumer preference has been underway for several years and has accelerated in the past year.
General Motors' decision to close the Lordstown plant was widely criticized, especially by then-President Donald Trump. As mentioned before, the plant was sold in 2019 to electric truck startup Workhorse Group, which has since been rebranded as Lordstown Motors (LTM). The electric-vehicle startup, backed by Workhorse Group, had gone public via a merger with DiamondPeak Holdings back in 2020. The deal was valued at $1.6 billion and saw Lordstown Motors become a publicly traded company.
The Up Swing
The initial intentions behind Workhorse buying the plant were directed to the production of the W-15 pickup truck, an EV with a 320-mile range and a price tag of $52,000. Despite that, the events ended up taking a U-turn as the Lordstown, Ohio General Motors plant changed its name to Lordstown Motors, while Workhorse revealed that the W-15 had been transferred via a licensing agreement - and, essentially, became the new Endurance. At the time, it was clear to everyone that GM made this move to keep the factory running.
Lordstown Motors' valuation increased to $4 billion when it became a publicly listed company and its stock climbed even further after Steve Burns, the then-CEO disclosed that they had over 100,000 pre-orders for the Endurance.
A Nose Dive
Lordstown received a lot of good press but the situation would soon change: on March 12th, 2021, a research study from Hindenburg was released, mentioning that an operational Endurance prototype had caught fire while tested by workers at the Ohio plant; something that, refuting the way-too-optimistic statements by CEO Steve Burns, revealed that the vehicle was still far from being ready for production.
However, the Hindenburg Research report on Lordstown Motors also showed that the 100,000 pre-sales for the Endurance that Lordstown CEO Steve Burns claimed; had all been fabricated and that Lordstown actually paid people to place the orders, which was by far the most significant remark in the report. The shares of Lordstown fell from around $25 to $10 as soon as the Hindenburg report became public. At the time of writing this post, the price for Lordstown Motors sits at $1.71 a share.
Subsequently, the fact that the whole involvement of General Motors in this situation was purely a matter of convenience became even clearer when the stock ended up taking its final collapse (end of 2021) and GM reversed course by selling all of its holdings in Lordstown Motors. Jim Cain, GM's executive director of corporate development, sales, and financial communications, stated:
"We invested in Lordstown Motors to help them complete the purchase of our former assembly plant and return it to vehicle production. We sold our small stake in the company in the fourth quarter of 2021."
A Ray Of Hope
Well, it appeared that it was all over for Lordstown Motors, but there was still some hope. Foxconn, a sizable multinational electronics contract manufacturer well known for contract manufacturing Apple goods, came to the rescue. What became a fortunate and successful joint-venture agreement between Lordstown Motors and Foxconn, ultimately came to be the main (if not the only) factor to keep LTM's business going.
In fact, Lordstown claimed in a document that it had severe cash flow issues that made it hard for it to function through June 2022; nevertheless, this new alliance offered the firm far more financial stability, and room to breathe. To put things into perspective - in addition to receiving reimbursement for around $27 million in operating and growth expenditures - Lordstown motors got $230 million in total revenues.
As of today, the Taiwanese manufacturer is boosting its stake in LTM by investing $170 million in freshly issued common and preferred shares. Foxconn will, on a pro forma basis, own all the outstanding preferred stock and 18.3 percent of the outstanding ordinary stock of Lordstown following the closing of the transaction. The businesses recently announced that Foxconn would also be qualified for two seats on the board of directors.
The Endurance: A Look At the Specs
The Endurance is the fourth American electric pickup truck to hit the market. The Rivian R1T was the first electric pick-up produced in the U.S. The second model was the GMC Hummer EV. The next and last car before Lordstown's Endurance was the Ford F-150 Lighting. With some liquidity at hand, Lordstown Motors finally has the ability to begin production of the Endurance.
Interestingly enough, Lordstown Motors has signed a long-term contract to get their batteries from LG. The 109 kWh batteries should recharge to 80 percent of their capacity utilizing the quickest methods in roughly an hour, and offer a range of more than 250 miles. The four motors, one on each wheel in this off-road pickup truck has a combined output of 405 kW, or 558 horsepower. This has resulted in a decrease from what they first pledged to provide: the Endurance was in fact anticipated to have a power output of 447 kW, or 600 horsepower, instead.
As for size, at 86 inches wide, 76 inches tall, and 146 inches in wheelbase, it is just shy of the F-150 Lightning. The 2023 Endurance is 2.7 inches shorter than the F-150 Lightning at 230 inches. Thought to start at $52,500, the 2023 Lordstown Endurance's pricing has now been revised by the automaker to a starting price closer to $65.000.
Reportedly, the team Lordstown-Foxconn is beginning to produce some of the very first units, as they finish the homologation and certification processes. These first units are part of the initial 500-unit batch, of which 10% or so will be delivered to clients before the end of the year; these will strictly be business clients as the vehicle is currently a B2B one. During the first half of 2023, the remaining Endurances from this initial batch will be finally distributed.