Lordstown Motors has been among the startups (Rivian, Canoo) promising electric pickups that can compete with the current titans of the truck world, but an update today shows the company's future is in doubt. The New York Times reports on a filing with the SEC that shows the company's ability to move forward as a going concern is at risk, simply because it doesn't currently have enough cash to start manufacturing the Endurance electric truck.
The Company had cash and cash equivalents of approximately $587.0 million and an accumulated deficit of $259.7 million at March 31, 2021 and a net loss of $125.2 million for the quarter ended March 31, 2021. Since inception, the Company has been developing its flagship vehicle, the Endurance, an electric full-size pickup truck. The Company’s ability to continue as a going concern is dependent on its ability to complete the development of its electric vehicles, obtain regulatory approval, begin commercial scale production and launch the sale of such vehicles. The Company believes that its current level of cash and cash equivalents are not sufficient to fund commercial scale production and the launch of sale of such vehicles. These conditions raise substantial doubt regarding our ability to continue as a going concern for a period of at least one year from the date of issuance of these unaudited condensed consolidated financial statements.
To alleviate these conditions, management is currently evaluating various funding alternatives and may seek to raise additional funds through the issuance of equity, mezzanine or debt securities, through arrangements with strategic partners or through obtaining credit from government or financial institutions. As we seek additional sources of financing, there can be no assurance that such financing would be available to us on favorable terms or at all. Our ability to obtain additional financing in the debt and equity capital markets is subject to several factors, including market and economic conditions, our performance and investor sentiment with respect to us and our industry.
The company went public in October via the maneuver known as a SPAC, special acquisitions company, and recently warned investors it was at risk of being delisted for missing a filing deadline. The plan has been to sell its truck to businesses, but with electric pickups arriving from Ford and others, it's only going to get harder to compete, assuming the Endurance comes to market in the first place.