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RIDE Stock Sinks As Short Seller Hindenburg Adds Lordstown To Hit List - Investor's Business Daily

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Short seller Hindenburg Research trained its guns on Lordstown Motors (RIDE) after taking aim at EV stocks Nikola (NKLA) and Kandi Technologies (KNDI), accusing the electric truck startup of misleading investors with fake orders.

Lordstown misled investors on both demand and production capabilities, Hindenburg said in report published Friday.

"Our conversations with former employees, business partners and an extensive document review show that the company's orders are largely fictitious and used as a prop to raise capital and confer legitimacy," the short seller said.

In January, Ohio-based Lordstown claimed more than 100,000 pre-orders from fleet operators for its proposed all-electric truck. It touts a 250-mile range for the Lordstown Endurance and says it's on track to start producing the EV this September.

But former employees estimate the electric truck is "3-4 years away from production, if it ever gets there," Hindenburg said in its scathing report. The EV "spontaneously combusted" in its very first road test, it alleged.

Lordstown did not immediately respond to a request for comment. Like many new EV stocks, it has a business plan but no revenue as yet. The company bought an old GM plant in Lordstown, Ohio, in November 2019. Its Endurance trucks are priced at $45,000 after federal EV rebates.

But it will enter a hotly contested market. Over the next one to three years, General Motors (GM), Ford (F) and Tesla (TSLA) all plan to bring electric pickup trucks to the market for the first time. So do EV startups Rivian, backed by Amazon (AMZN), and Canoo (GOEV).


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RIDE Stock, EV Stocks

Lordstown shares sank 17% to 14.76 in Friday's stock market. RIDE stock further undercut the 40-week line after falling below the 10-week line in late February, according to MarketSmith chart analysis.

Among other EV stocks, Nikola stock lost 3.5% and Kandi shed 2.1%, with both EV stocks also below their 10- and 40-week lines. Tesla fell 2.5% near 683 .

Hindenburg accused Nikola of an "ocean" of lies last September. The short seller targeted China's Kandi last November, alleging it made up sales.

The short seller's damning Nikola report led to the unraveling of a manufacturing pact with GM. That, in turn, ended Nikola's hopes of producing the Badger pickup electric truck.

Both companies rebutted allegations.

Find Aparna Narayanan on Twitter at @IBD_Aparna.

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RIDE Stock Sinks As Short Seller Hindenburg Adds Lordstown To Hit List - Investor's Business Daily
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