SAN FRANCISCO — Lordstown Motors said on Wednesday it experienced received a request for information from the U.S. securities regulator about accusations by an investor that took a brief posture in the inventory and accused the electric truck startup of deceptive consumers and traders.

Past 7 days, Hindenburg Study discovered it experienced taken a brief posture in Lordstown Motors, accusing the corporation of applying “bogus” orders to elevate money and declaring that its forthcoming truck is a few to four decades away from creation.

“We are cooperating with that inquiry,” Lordstown Motors CEO Steve Burns said for the duration of an earnings meeting contact, referring to the U.S. Securities and Trade Commission’s request for information.

He also said Lordstown’s board of administrators has fashioned a exclusive committee to assessment the matters.

Burns said Lordstown won’t straight address Hindenburg’s accusations. The truck is on schedule to be designed in September, with a strategy to construct its take a look at autos this thirty day period, Burns said, a timeline Hindenburg’s report experienced doubted.

Desire from customers implies strong demand, Burns said. Lordstown and founder Burns have been accused of deceptive traders by exaggerating orders for the Stamina.

“Our conversation with our consumer has permitted us to gauge demand,” Burns said on the contact. “This gauge is critical due to the fact tooling can price tag hundreds of tens of millions of pounds. We are in the system of expanding our creation capability to 60,000 vehicles a year.”

Short sellers bet that the selling price of a inventory will tumble by borrowing shares in the hope of purchasing them again at a more cost-effective selling price and pocketing the big difference.

Shares of Lordstown Motors have been down 5% in extended buying and selling on Wednesday.

“Our discussions with previous workers, enterprise associates and an intensive doc assessment display that the firm’s orders are mostly fictitious and utilised as a prop to elevate money and confer legitimacy,” Hindenburg said very last Friday.

Burns, in a text concept to Bloomberg, resolved that accusation, expressing “we constantly mentioned that pre-orders have been non-binding. That is what pre-orders are.”

He said Wednesday that consumer fascination experienced exceeded the firm’s anticipations.

The corporation in 2019 acquired a shuttered Basic Motors plant in Lordstown, Ohio.

It also programs to unveil the demonstration product of its 2nd car, an electric van, this summer months, with a target to start off creation in the 2nd 50 percent of 2022.

Lordstown reported a loss of 23 cents per share for the duration of the Oct to December quarter.

In its report, Hindenburg said Lordstown is a corporation “with no profits and no sellable product, which we consider has misled traders on the two its demand and creation abilities.” 

But the corporation has been upfront about not owning profits from car profits, and is expending money getting its truck into creation.

The corporation experienced $630 million in money at the close of the year. With projected money expenses of $250 million to $275 million in 2021, and $220 million to $235 million in running fees and R&D, Lordstown expects to end this year with at the very least $two hundred million in money. The corporation is applying for a financial loan from the U.S. Division of Strength beneath the Advanced Engineering Vehicles Production method.

Substance from Bloomberg was utilised in this report.