Lordstown Motors’ CEO, CFO resign in latest setback for electric startup

Company likely going to court amid fraud allegations

Lordstown Motors' CEO, CFO resign in latest setback for electric startup

Lordstown Motors started a few years ago with the promise of building the commercial Endurance pick up truck.

The company attracted about $600 million in investments to allow it to go public last fall. However, CEO Steve Burns and Chief Financial Officer Julio Rodriguez stepped down after admitting one of the companies committed to buy a sizable number of the first trucks does not have the money to do so.

Lordstown Motors is now likely headed to court amid allegations of fraud.

MORE: Lordstown Motors’ rough road continues; CEO and CFO are out

MORE: Startup Lordstown Motors warns it may not stay in business

FILE - In this June 25, 2020 file photo, the electric Endurance pick-up truck at Lordstown Motors Corporation is shown, in Lordstown, Ohio. Lordstown Motors CEO Steve Burns and Chief Financial Officer Julio Rodriguez have resigned from the startup commercial electric vehicle maker. The announcement comes less than a week after Lordstown cautioned that it may not be in business a year from now as it tries to secure funding to start full production of the electric pickup truck. (AP Photo/Tony Dejak, File) (Copyright 2020 The Associated Press. All rights reserved.)

Guidehouse Insights Energy Auto analyst Sam Abuelsamid said it’s not a surprise about the company, first because of the way the company landed its former General Motors car plant in Lordstown, Ohio.

“I’ve been skeptical of Lordstown’s prospects from the beginning,” Abuelsamid said.

“When GM got involved with Lordstown, it was probably more for political reasons, essentially to get (former President) Donald Trump off their back for closing the Lordstown assembly plant. They essentially gave the factory to Steve Burns for this new venture.”

Additionally, Lordstown Motors’ design puts electric motors on each wheel but it puts stress on the electric wiring unlike most of its competition.

“Chances are they’re probably going to end up winding down,” Abuelsamid said.

READ: ‘A showcase of what’s to come’: Ford unveils all-electric F-150 Lightning

READ: GM exec: Company to announce more battery plants this week

About the Author:

Rod Meloni is an Emmy Award-winning Business Editor on Local 4 News and a Certified Financial Planner™ Professional.