More than 14% decrease in pre-market explanation
- Lordstown Motors Corp’s (NASDAQ: RIDE) share price has fallen more than 14% before it goes to market. That’s why it happened.
Lordstown Motors Corp’s (NASDAQ: RIDE) share price has fallen more than 14% before it goes to market. Investors are reacting negatively to the company’s reduction in its production forecast for the year, according to CNBC. And the company has also said it needs to raise more capital.
Lordstown CEO Steve Burns said the company has faced challenges as it prepares to start production of its Endurance electric pickup later this year.
In a call with investors, Burns said the reduction in production – from 2,200 vehicles to 1,000 vehicles this year – was based on the company not receiving any additional funding. But if the company receives funding, it could revert to its previous production forecast.
Additionally, Lordstown also predicts its spending to be between $ 335 million and $ 350 million – which is $ 220 million to $ 235 million. Lordstown also cut its year-end cash flow forecast by at least $ 200 million to somewhere between $ 50 million and $ 75 million in cash and cash equivalents.
Burns pointed out that the company is seeing “significantly higher spending than expected on parts / equipment, expedited shipping costs, and expenses associated with third-party engineering resources.”
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