Lordstown Motors shares rise after Icahn’s ex-manager is called CEO

Lordstown Motors Corp.’s Endurance electric pickup truck. sits on stage during an unveiling ceremony in Lordstown, Ohio, the United States, on Thursday, June 25, 2020.

Matthew Hatcher | Bloomberg | Getty Images

Lordstown Motors’ shares rose Thursday after competitive electric vehicle startup named Daniel Ninivaggi, a longtime automotive veteran and former head of Icahn Enterprises, as its new CEO.

The volatile stock rose up to 41.4% in intraday trading before leveling off at around $ 6.40 per share on Thursday afternoon, up 16.2% on Thursday afternoon. The stock moved from a low of $ 4.77 per share to as low as $ 31.80 per share over the past 52 weeks.

Ninivaggi downplayed the stock’s performance on Thursday, telling CNBC that it is focused on meeting short-term goals that will strengthen the company over the long term.

“I don’t care about the share price in everyday life. But we definitely need to work on investor confidence. And we do that by adhering to our production schedule and ourselves through all of our tests and certifications, “he said during a telephone interview on Thursday.

Ninivaggi, whose annual base salary will be $ 750,000, said he has no plans at this point to change the company’s previously announced goals or plans.

Ohio-based Lordstown Motors has yet to produce a salable vehicle. The company expects to begin limited production of its first product, an electric pickup named Endurance, in late September, followed by vehicle validation and regulatory approval in December or January. Sales and deliveries then follow, according to Ninivaggi.

“Now we have to execute and get that truck out the door,” he said. “That’s what I’m concentrating on. It’s not sexy, but we have to get the truck out the door, perform and market it.

We know we actually have to vote because we have to get that truck out the door.

The appointment of Ninivaggi, who had gained experience primarily with automotive suppliers before working for the billionaire Carl Icahn, is effective with immediate effect, the company said. He will retain his position as chairman of auto parts supplier Garrett Motion, a Lordstown spokeswoman said.

Ninivaggi, 57, said he has not approached Icahn as a potential investor in the company, nor does he plan to contact him. In May, Lordstown said there were “significant doubts” about its ability to continue for the next year due to problems financing production of its vehicle. She is currently looking for further funds.

Ninivaggi replaces company founder Steve Burns, who left the automaker in June after an internal investigation found “problems with the accuracy of certain statements about” Lordstown’s pre-orders, particularly the seriousness of the orders and their clients.

“The board of directors is delighted with Dan’s appointment as CEO. We are impressed by his broad automotive background, track record, strategic thinking and team-oriented leadership talent. In addition, his capital markets and investment expertise will be invaluable in helping the company navigate its commercial start-up, capital allocation and growth phases, “said David Hamamoto, chairman of the Lordstown Board’s CEO Search Committee, in a statement.

Workers install door hinges on the body of a prototype electric endurance pickup truck at the Lordstown Motors assembly plant in Ohio on June 21, 2021.

Michael Wayland | CNBC

The internal investigation came after short seller Hindenburg Research alleged that Lordstown had misled investors. The report led to investigations by the Justice Department and the Securities and Exchange Commission.

Lordstown went public in October through a special acquisition company (SPAC). It is one of a growing group of EV startups going public or announcing plans to do so with SPACs.

Most SPAC deals were initially celebrated by investors who sent shares through the roof and turned some founders into millionaires, if not billionaires, overnight. But the tide has turned on many of the companies after the SEC cracked down on cracks this year, including investigations, warnings to investors, and potential changes to accounting policies.

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