GM Sells Stake In Embattled EV Start-up

(RTTNews) - American carmaker General Motors Co. (GM) said on Tuesday that the company has sold its small stake in beleaguered electric vehicle start-up Lordstown Motors Corp.

GM spokesman Jim Cain said that the company sold its 7.5 million Class A common stock shares in the company in the fourth quarter. This stake is less than 5 percent. Under different heads, Lordstown Motors had purchased the former GM Lordstown Assembly plant in northeast Ohio in 2019 once GM shut the doors there after more than 50 years of production. GM had invested $75 million in Lordstown Motors in cash and in-kind contributions.

The GM spokesperson said that the investment was made to facilitate the sale of the plant to restart production there.

Lordstown has still now not started production of its Endurance electric truck. The start-up was affected by bad publicity after negative feedback from a short seller pushed the CEO and founder, Steve Burns, to exit.

A new CEO has now taken over but on Monday, the company's stock fell 20 percent to $2.53 per share after leaders reported a negative forecast for truck deliveries, the success of which depends on raising more money and reaching a partnership agreement with the manufacturer Foxconn.

Lordstown executives told investors that they were still on the deal with Foxconn, which bought the northeast Ohio plant for $230 million last year.

The company expects commercial production to begin in the third quarter this year with 500 sales slated in 2022. Production will grow to as many as 2,500 trucks in 2023, it said.