After a tumultuous last year, electric vehicle (EV) start-up Lordstown Motors (RIDE 0.18%) is getting closer to beginning commercial production of its Endurance pickup truck. But investors still aren't happy with what they heard from the company's fourth-quarter and full-year 2021 financial update this morning. Lordstown shares fell as much as 19% in early trading Monday and remained down 17.1% as of 11:08 a.m. ET.
Lordstown has been working to turn the corner after its former CEO Steve Burns overpromised investors on customer interest and its production timeline. Burns stepped aside in June 2021, and the company has since pivoted to an agreement with Foxconn to take over its facility and produce the Endurance trucks. But though the company still plans to begin production in the third quarter of 2022, its plans to have only up to 3,000 trucks produced by the end of 2023 didn't please investors today.
Lordstown plans to have 500 trucks produced this year, but only expects to ramp that up to another 2,500 for 2023. In addition to that, the company said it will continue to look for additional capital "to fund commercial launch of the Endurance and operating plan."
That news isn't sitting well with investors. And today's stock drop is just adding to the previous declines in the share price. Lordstown stock is now down more than 86% in the last year.
The good news is the company said it ended 2021 with $244 million in cash. That was well above the top of the range it previously projected. The company said that came from more disciplined spending along with its raising capital and pushing back some investments into 2022. It also plans to finalize its contract manufacturing agreement with Foxconn and is looking to collaborate for new vehicles.
But investors aren't putting much faith in the positive news. The bottom line is there won't be much revenue coming in, and with the need to raise additional capital, existing shareholders are likely to experience dilution. It wouldn't be surprising to see analysts also react negatively and downgrade the stock on this report.