Lordstown Motors continues its woes. The Department of Justice is currently investigating the beleaguered startup for electric vehicles. A continuing investigation is also being conducted by the Securities and Exchange Commission.According to unnamed sources, the investigation that was first reported by The Wall Street Journal on Friday is still in its early stages. The U.S. Attorneys office in Manhattan is conducting the investigation.TechCrunch was informed by a spokesperson for Lordstown Motors that the company is open to any regulatory or government inquiries and investigations. We are looking forward to closing this chapter so our new leadership team and dedicated team can concentrate solely on the Lordstown Endurance, an all-electric full-size pickup truck.This probe is the latest in a string of problems for the startup. It recently announced that it would have to reduce production volumes for Endurance's electric pickup by half, from approximately 2,200 vehicles to 1,000. A few weeks later, the company announced that Steve Burns, its founder, and Julio Rodriguez, its CFO, had resigned. The company was an offshoot from Workhorse Group, which Burns founded.Lordstown started strong, thanks to investments by General Motors. This allowed it to purchase a factory measuring 6.2 million square feet from the top automaker in late 2019 at a cost of $2.5 million. Lordstown was the subject of positive headlines when it announced that it would merge with a special-purpose acquisition company (SPAC) and go public. The deal injected $675 million into the EV startup and soared its market value to $1.6billion. Lordstown informed SEC less than a year later that it did not have enough capital to produce Endurance.Hindenburg Research, a short-seller, released a March report disputing the company's claim that it had received 100,000 pre-orders to purchase the electric pickup. It stated that extensive research has shown that orders placed by the company appear to be fictitious and that they were used as a way to raise capital.The scope of the inquiry is not clear from the WSJ story and the company refused to give details. TechCrunch will update this story if it finds out more.
