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Lordstown Shares Plunge on Endurance Truck Production Cut, Capital Call

'Our research indicates a very robust demand for our vehicles. However, capital may limit our ability to make as many vehicles as we would like,' Lordstown CEO Steve Burns tells investors.

Lordstown Motors  (RIDE) - Get LORDSTOWN MOTORS CORP. Report shares plunged lower Tuesday after the electric carmaker said 2021 production of its flagship tuck would be around half of its previous forecasts, triggering a string of price cuts from Wall Street analysts.

Lordstown, which reported a wider-than-expected first quarter loss of $125.2 million, said supply-chain issues, rising costs and a global shortage of semiconductor components have forced it to slash production forecasts for its Endurance truck to around 1,100, although it still hopes for a full September launch.

The group also said it was looking for near-term financing support -- including from the U.S. Energy Department -- adding that  "capital may limit our ability to make as many vehicles as we would like" during a conference call with investors. 

"Our ability to produce enough vehicles to satisfy our expected market demand depends on many variables, such as suppliers and passing all required regulatory hurdles, and also, our access to capital," said CEO Steve Burns. "Our research indicates a very robust demand for our vehicles. However, capital may limit our ability to make as many vehicles as we would like. And as such, we are constantly evaluating our capital needs and the various types of capital available to us, including strategic capital."

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"I don't think we've ever considered selling the company, but we are in discussions with a few strategics, large strategic investors, that, of course, would bring something a lot more than funding," he added.

Lordstown shares were marked 16.55% lower in pre-market trading Tuesday to indicate an opening bell price of $8.07 each, a move that would extend the stock's year-to-date slump to around 60%.

Morgan Stanley analyst Adam Jonas lowered his price target on the group by $4, to $8 a share, arguing that without a capital injection, Lordstown's year-end cash balance would be below the minimum level needed to run the business.

Wolfe Research lowered its rating on the carmaker to 'underperform', and slashed its price target to $1 per share, adding that Lordstown "will not be competitive in the commercial EV pickup space.