{"id":109935,"date":"2021-03-18T18:03:34","date_gmt":"2021-03-18T18:03:34","guid":{"rendered":"https:\/\/fin2me.com\/?p=109935"},"modified":"2021-03-18T18:03:34","modified_gmt":"2021-03-18T18:03:34","slug":"electric-truck-startup-lordstown-slumps-12-on-sec-probe","status":"publish","type":"post","link":"https:\/\/fin2me.com\/markets\/electric-truck-startup-lordstown-slumps-12-on-sec-probe\/","title":{"rendered":"Electric truck startup Lordstown slumps 12% on SEC probe"},"content":{"rendered":"
(Reuters) – Lordstown Motors Corp shares plunged nearly 12% on Thursday after the electric pickup truck firm disclosed a regulatory inquiry over a short seller\u2019s report claiming the company was using \u201cfake\u201d orders to raise capital.<\/p> The drop was the latest sign of a recent retreat in the once high flying electric vehicle sector, whose ranks have been swollen by the recent boom in special purpose acquisition companies, or SPACS.<\/p>\n Nikola, another electric pickup truck startup which has been attacked by the Hindenburg in the past, separately fell more than 7% hit by a key investor cutting its stake.<\/p>\n Lordstown and Nikola, which both went public via acquisitions by SPACS – shell companies that use their IPO proceeds to acquire private firms – are both down roughly 50% from their highs this year. Concern about technology, as well as rising yields, have weighed on the sector.<\/p>\n South Korea\u2019s Hanwha Corp will be selling up to half of its stake in Nikola, the EV maker said on Wednesday, amid concerns about the company\u2019s future prospects.<\/p>\n \u201cIn this golden age of EVs there are clear growing pains and this just adds to the dynamic for the sector and Nikola,\u201d said Wedbush analyst Daniel Ives.<\/p>\n Lordstown revealed on Wednesday that it received a request for information from the U.S. Securities and Exchange Commission regarding accusations by Hindenburg pertaining to its order book.<\/p>\n Lordstown Chief Executive Steve Burns declined to state in a CNBC TV interview on Thursday whether he had been too aggressive in characterizing the firm\u2019s orders as \u2018serious\u2019 commitments from customers.<\/p>\n \u201cWe never said we had orders. We don\u2019t have a product yet so by definition we can\u2019t have orders,\u201d Burns said, adding that any orders were \u2018non-binding\u2019 and were only meant to gauge customers\u2019 interest ahead of targetted production of its Endurance trucks in September.<\/p>\n BTIG analyst Gregory Lewis said Lordstown\u2019s ability get the Endurance through its beta testing phase and into production while winning orders will be the biggest driver of the stock over the next year.<\/p>\n