Lordstown Motors inventory plunges on report from the DOJ investigation

Signage outside the Lordstown Motors Corp. headquarters. in Lordstown, Ohio on Saturday, May 15, 2021.

Dustin Franz | Bloomberg | Getty Images

Lordstown Motors stock plunged as much as 17% on Friday after the Wall Street Journal reported that the Department of Justice was investigating the contested start of electric vehicles.

The stock was momentarily halted due to volatility and fell about 10% to about $ 9.30 per share on Friday lunchtime in New York.

A DOJ investigation report follows a confirmed investigation into the company by the Securities and Exchange Commission earlier this year and public comments from senior executives, including former chairman and CEO Steve Burns.

A company spokesman declined to comment on the DOJ investigation, but said in a statement: “Lordstown Motors is committed to cooperating with all governmental or regulatory investigations and investigations. We look forward to closing this chapter so that our new leadership – and the entire dedicated team – focus solely on producing the first and best full-size, all-electric pickup, the Lordstown Endurance. “

The DOJ did not immediately respond to comments.

Burns and his CFO left the SPAC-backed company after an internal investigation that found “problems related to the accuracy of certain statements” regarding Lordstown’s pre-orders, specifically the seriousness of the orders and who placed them.

In May, short seller Hindenburg Research claimed the company had misled investors, including using “fake” orders to raise capital for its Endurance electric pickup truck. The short seller also said the pickup was years away from production. Lordstown has kept its plan to start manufacturing the vehicle in September.

Lordstown Motors previously said the internal investigation found that Hindenburg’s report was “fundamentally incorrect and misleading”.