March 08, 2021 - An investor in shares of Workhorse Group Inc. (NASDAQ: WKHS) filed a lawsuit in the U.S. District Court for the Central District of California over alleged violations of Federal Securities Laws by Workhorse Group Inc. in connection with certain allegedly false and misleading statements made between July 7, 2020 and February 23, 2021.
Loveland, OH based Workhorse Group Inc., a technology company, designs, manufactures, builds, and sells battery-electric vehicles and aircraft in the United States. Workhorse Group Inc. declined from $763.17 million in 2018 to $376.56 million in 2019, and that its Net Loss increased from $36.5 million in 2018 to $37.16 million in 2019. Workhorse Group Inc. submitted a bid to participate in the United States Postal Service’s “next generation delivery vehicle” (NGDV) search, which would replace an aging fleet of more than 200,000 trucks. Final bids were submitted on July 14, 2020. In a July 21, 2020 article published, Steve Schrader, Workhorse’s CFO, provided an update on the USPS contract estimated to be worth $6 billion. According to the article, “Schrader said he can’t discuss too much about the process at this point, but Workhorse is the only all-electric option” and Schrader reportedly stated “[w]hat I will say is our all-electric is probably the perfect vehicle for them. . . .”
On February 23, 2021, USPS awarded its contract to finalize the design of the NGDV and assemble 50,000 to 165,000 vehicles over 10 years to Oshkosh Defense, beating electric-vehicle maker Workhorse Group Inc.. According to USPS, “the vehicles will be equipped with either fuel-efficient internal combustion engines or battery electric powertrains and can be retrofitted to keep pace with advances in electric vehicle technologies.” Shares of Workhorse Group Inc. (NASDAQ: WKHS) declined $42.96 per share on February 4, 2021 to $12.50 per share on February 23, 2021. According to the complaint the plaintiff alleges on behalf of purchasers of Workhorse Group Inc. (NASDAQ: WKHS) common shares between July 7, 2020 and February 23, 2021, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that between July 7, 2020 and February 23, 2021, the defendants made false and/or misleading statements and/or failed to disclose that the Company was merely hoping that USPS was going to select an electric vehicle as its Next Generation Delivery Vehicle, and had no assurance or indication from USPS that this was the case, that the Company had concealed the fact that – as revealed by the postmaster general in explaining the ultimate decision not to select an electric vehicle – electrifying the USPS’s entire fleet would be impractical and astronomically expensive, and that as a result, defendants’ statements about Workhorse’s business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.