Lordstown Motors slumps 15% on announcement of CEO and CFO resignation

FILE PHOTO: A view of the entrance to the West Plant at the General Motors Lordstown Complex, assembly plant in Warren, Ohio, U.S., November 26, 2018. REUTERS/Alan Freed
FILE PHOTO: A view of the entrance to the West Plant of the General Motors Lordstown Complex assembly plant in Warren. Reuters
  • Lordstown Motors shares fell 15% Monday after the company announced the CEO and CFO resigned.
  • The resignations are effective immediately, according to a press release.
  • Shares of the electric-vehicle startup have now lost about half their value this year.
  • See more stories on Insider’s business page.

Lordstown Motors slumped 15% early Monday after two top executives announced their immediate resignation just days after the company said it may run out of cash.

Chief Executive Officer Steve Burns resigned from his position as CEO and board member, and Chief Financial Officer Julio Rodriguez resigned from his post, according to a company press release. Both are effective immediately.

The company appointed Lead Independent Director Angela Strand as the executive chairwoman to oversee the CEO transition until a permanent leader is identified, the company said. Becky Roof will serve as the interim Chief Financial Officer.

“As we transition to the commercial stage of our business – with planned commencement of limited production in late-September – we have to put in place a seasoned management team with deep experience leading and operating publicly-listed OEM companies,” the company said in its release.

Shares of the Lordstown, Ohio-based electric vehicle startup fell below $10 Thursday, meaning the stock has lost about half its value so far this year.

In 2019, the company purchased a former General Motors plant in Ohio to start producing the Endurance electric pickup this fall. But last week, the company told shareholders it might not have enough cash to start commercial production of its pickup this year, and it had “sufficient doubts” as to whether it would be able to meet its financial obligations.

In March, Lordstown was the target of short-seller Hindenburg Research, which accused the company of pumping up preorder numbers to generate investor interest.

Lordstown Motors went public in October via a special purpose acquisition company. It is among a string of electric-vehicle makers that saw their share price peak in February and have since declined.