The rise and fall of the nikola motors executive chairman trevor milton was a strong warning to other fraudulent companies of the consequences that would follow when attempting to deceive investors. As many of us know, nicola's valuation has dropped by substantial amounts and is currently being investigated by the sec for securities fraud. Of course, we don't know the consequences that trevor will face yet, but we do know that his quote-unquote groundbreaking reputation has been destroyed. Most recently, a new eevee company, named lordstown motors, has been preparing to go spac which will take place under the ticker symbol r-i-d-e at a starting valuation of 1.6 billion dollars.

Lordstown motors is certainly not a company. I would trust, even if this isn't a fraud. I do have to say that the stock is extremely overvalued in this video, i'm going to go over the background of lordstown motors and why i'm not investing in this spac. Also, i'm not going to be so quick to say that this company is a fraud, but it is a possibility.

Welcome to cad games academy if you're new to the channel. Please consider subscribing for more content like this and let's get right into it. The current ceo of lordtown motors steve burns did not start his journey with lordstown back in 2018, steve was a ceo of workhorse, which is another electric vehicle manufacturer. That here today is focusing on producing electric delivery vans at workhorse steve promised to deliver an electric pickup truck named the workhorse w15.

The truck would have a 100 mile electric range and have a gas range extender that would increase the range to a total of 310 miles in order to pre-order. The truck you'd have to put a 1 000 deposit down, and this is where things get quite sketchy. This truck would come out in 2018, but then got delayed to 2019 and eventually, after steve stepped down as a ceo, never got delivered at all in the following clip that took place in 2018, steve talks excitedly about the upcoming workhorse w15., some of the fleets that Pre-Ordered uh are going to get it latter part of this year, they're going to get some early units to make sure we haven't missed anything and it covers their needs. Uh and so initial production will start late this year, but the the bulk of them will be in 19..

According to steve himself. The production of the workhorse w15 was supposed to start in 2018 and begin mass production in 2019, but unbeknownst to the interviewer. At the time, the truck never went into production at all in february of 2019, steve earned suddenly at the exit workhorse immediately, which was not a great look for both workhorse and steve. He would remain as the quote-unquote consultant for workhorse, but no longer had any job position at workhorse.

The customers who reserved the w15 were soon questioning their pre-orders. They put down a deposit of a thousand dollars per truck and never received the truck. So if for those of my viewers who haven't reserved the truck but want to uh, tell us how they can do it, uh we've got a link on our website, a thousand dollars down with a credit card, and, and you get your place in line again, a Little bit of caveat that we want to make sure we get some fleet ones out. First, we really want to cut our teeth on the fleet, and then we will start fulfilling consumer orders steve who desperately needed some position had an idea.

If he created his own company, then he would be able to purchase the workhorse w15 design and transfer all the reservations to his company. This is where lordstown motors comes into play, which is the stock that is going ipo through spac soon, at a valuation of 1.6 billion dollars, workhorse was in the process of purchasing a plant from gm, dubbed the lordstown assembly, yet after steve decided that his company would Manufacture the w15. There was no reason for workers to purchase the plant as a result, steve stepped in with his new company lordstown motors and purchased the plant from gm for 40 million dollars. Now, after purchasing the workhorse w15 design from workhorse, steve rebranded the vehicle and names the vehicle, the lordtown endurance, he made just one change, which was to make the entire vehicle electric with 250 miles of range and acted as if the vehicle is the best pickup.

In the world, according to burns himself, lordstown will have the best traction of any pickup truck ever made. We don't say that lightly. The truck would go into production in 2020, but of course, as you can guess, the production timeline has been delayed to 2021 from 2018 to 2019 to 2020 and now to 2021. Lordstown is definitely not a company.

I would trust with my money. This company, in my opinion, has a lot of red flags unveiled on june 25th, 2020 lordstown's new pickup truck had plenty of hype, as the automaker received 27 000 pre-orders for the lordstown endurance. Yet, like plenty of suspiciously, impressive numbers, there's a catch in order to pre-order the truck you'd have to put a 100 refundable deposit. Despite this, lordstown claims the pre-orders as revenue when pitching the company to its investors, lordstown stated that its vehicles have received more than 27 000 preorders for the vehicle, representing over 1.4 billion dollars of potential revenue, primarily from commercial fleet customers.

This is oddly reminiscent of nikola motors, who also use their pre-orders in order to show that the company had all this revenue that was going to be flooded in yeah. We do. We have orders for both the battery electric and for the hydrogen electric. The hydrogen electric we've already publicly announced is over a 10 billion dollar backlog of lease reservations for that for that hydrogen truck.

So it's like a five year backlog on production truth to be told. However, mass manufacturing is the most difficult part of production. In addition, lorton's claims about his pickup truck are absolutely ridiculous. In november of 2019, lord sung claims that the automaker would beat tesla to the market as the first electric pickup truck.

However, on that day, they had no prototype to show that's right, no prototype at all. In order to create hype for the lordstown pickup, the automaker released some computer generated images of their pickup. Not only that, but they've also claimed that the quote. Unquote.

Big innovation is the fact that they're using hub motors for those of you not too familiar with how ridiculous that is hub motors are frequently used for lighter vehicles such as electric scooters and bikes. They've never been used in electric vehicles for a major reason. Hub motors. Do not even provide enough energy to propel the car fast enough to be viable right now.

We're just maniacally focused on the endurance right getting them out, but just for some of your viewers that might not know what a hub motor is. You know i always describe it as um. You know the lime or bird scooters that you see in all the cities right, those kind of just descended upon the world uh with one innovation that happened right. It wasn't the the batteries the batteries had been there for a while it was the hub motor right.

So if you think about those scooters, you don't see a a motor down by your feet with a sprocket and a chain going back to drive the rear motor right yeah and once you say that people are like yeah you're right. Where is the motor, so the motor is in the wheel and in our case you know up sizing those and having four giant hub motors, so four moving parts right versus 2 000.. On top of all of that, in june of 2020, lord son finally revealed their prototype and somehow still expect to go into production in 2021. Elon musk is off on timelines quite often, but the extent that lordstown is off on is not even on the same scale.

Lordshawn made a single prototype and is acting like they can suddenly scale to mass production in less than one year. This all seems, like a huge investor grab to me, as i'm recording this lordsang currently trades under the ticker symbol, dphc and will officially go public under the ticker symbol r-i-d-e on october 22nd, 2020.. I'm not a financial advisor, and you should always do your own. Due diligence, but i do have to say that personally, this is a stock that i'm very cautious about.

This could allegedly very well be trevor milton and nikola motors all over again. Let me know what you think about lordstown motors. Do you agree with my analysis, or do you actually think there can be an investment opportunity here? Just to be clear? I do want lordstown to succeed, because this could help electrification a whole lot. But let me know your opinion.

If you enjoyed this video, please hit the like button and subscribe and i'll see you in the next one.