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Lordstown Motors Shares Plunge as Investors See Problems

Mr. Burns’s tenure at Workhorse was decidedly mixed. Workhorse has lost money for years, and its annual revenue was never more than $10 million when Mr. Burns ran the company. One of his initiatives was a bid to supply delivery vehicles to the U.S. Postal Service. While the company was a finalist, it lost to another bidder in February.

Workhorse paid Mr. Burns $1.24 million from 2015 to 2018, according to Equilar, a firm that analyzes corporate compensation. He probably forfeited his stock options at Workhorse by resigning in 2019, but the company gave him a consulting agreement with stock options that Equilar valued at $10.7 million.

What really propelled Mr. Burns and Lordstown was the merger with DiamondPeak.

Backed by some of the principals of the New York investment firm Silverpeak, DiamondPeak raised $250 million from investors when it went public in March 2019, about a year before special purpose acquisition companies became the hottest thing on Wall Street. In securities filings, DiamondPeak said it would probably acquire a real estate business, which made sense because it was led by David Hamamoto, a former Goldman Sachs banker who specialized in that industry.

DiamondPeak decided to buy Lordstown after Mr. Hamamoto was introduced to Mr. Burns in June by Goldman bankers. The deal prospectus said Goldman had known Mr. Burns because of a prior investment banking relationship with him at Workhorse.

Both sides were eager. Lordstown and its backers needed more money, and DiamondPeak was on a deadline to complete a merger to comply with the terms of its initial public offering.

The merger included a fresh investment of $500 million from BlackRock, Fidelity Investments, Wellington Management and others.

Shares of DiamondPeak, later renamed Lordstown Motors, took off even before the merger closed. Some of the sponsors of DiamondPeak were registered in a prospectus late last year to allow them to sell some of their shares in the combined company, along with other investors in the financing deal. Included in the prospectus were some of the bankers at Brown Gibbons Lang, an investment bank, and lawyers with BakerHostetler, a Cleveland-based law firm that reviewed the financing package. Altogether, insider sales have totaled $11 million since the end of December.

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E.V. Buying Guide: What to Know About Models, Batteries, Charging and More

Buying used could be a cheaper way to get an electric vehicle, though evaluate the car you are buying carefully, particularly the quality of the battery, because it will degrade over time. That said, a used electric vehicle could be a perfect choice for a second car for errands, commutes and other short trips.

As exciting as it may be to own an electric vehicle, it may not be for everyone. Many families and individuals can’t afford an E.V. that meets their needs — there are few electric vehicles with three rows and room for youth sports gear, for example, and they tend to be expensive. Others cannot easily charge at or near their homes. That’s why Mr. DeLorenzo and Mr. Fisher recommend plug-in hybrids.

“If you’re interested but not really sure you want to commit, these plug-in hybrids are kind of a gateway,” Mr. Fisher, of Consumer Reports, said.

For many people, a plug-in like a Chrysler Pacifica Hybrid minivan or the RAV4 Prime S.U.V. could effectively serve as an all-electric vehicle, he said. Toyota claims the RAV4 Prime can run for 42 miles before switching to gasoline, while Chrysler says the Pacifica has 32 miles on a full charge. If used mostly for short commutes to work and trips around town, the cars could rarely use gas. Those two vehicles and other plug-in hybrids also qualify for federal tax credits.

“You can just plug it into your normal wall outlet and charge it overnight and you can get a taste of what that’s like, having an E.V., and then maybe your next vehicle will be a pure E.V.,” he said.

Of course, gas-powered cars have grown increasingly efficient, and choosing one wisely can help reduce emissions if you are upgrading from an older vehicle. Yet many people buy cars based on what they consider alluring and attractive. And if you are wowed by the features and design of an E.V., you might find it hard to settle for anything else, Mr. DeLorenzo said.

“It’s a different experience,” he said. “It’s not the same as owning a regular car, for sure. So there’s something to be said for that.”

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Three Electric S.U.V.s With Tesla in Their Sights

An electric trickle is turning into a flood: As many as 100 new E.V. models are coming to showrooms by 2025. Heavyweights including Volkswagen, General Motors and Ford are floating promises of all-electric lineups within a decade.

The end times of gasoline can almost seem a fait accompli, except for one pesky issue: Even given Tesla’s strides, we’re still waiting for the first genuine E.V. sales hit, let alone a mass exodus from unleaded.

In 2014, Nissan sold a mere 30,200 Leafs, and that’s still the American record for any non-Tesla model. Ford routinely sells more than 800,000 F-Series pickups. A single gasoline sport utility vehicle, the Toyota RAV4, finds well over 400,000 annual buyers, compared with roughly 250,000 sales last year for all E.V.s combined — 200,000 of which were Teslas.

Automakers insist we’re “this close” to a tipping point. E.V. market share is expected to grow to as much as 50 percent by 2032, from just 1.7 percent last year, said Scott Keogh, president and chief executive of Volkswagen of America. While Tesla captured 80 percent of the U.S. market for electric vehicles in 2020, VW and other global giants — with war chests built on internal-combustion engines and unmatched scale and manufacturing know-how — are well positioned to take a piece of Tesla’s pie.

prices and charging times of E.V.s, while bolstering driving range, until consumers see no reason to stick with polluting gasoline models whose energy-and-operating costs exceed the plug-in alternatives.

Like the Rolling Stones pushing the Beatles, Mr. Keogh said, healthy competition will ultimately benefit all E.V. fans and creators. And when consumers sees E.V.s proliferate in their neighbors’ driveways, and take their first test drive, there will be no going back.

Mach-E seems the most straight-up rival yet to Tesla’s Model Y, in not only price and performance but also the Ford’s maximum 300-mile driving range.

Consumers have noticed: Ford sold 3,729 Mach-Es in February, the first full month of sales, almost single-handedly chopping Tesla’s dominant E.V. share to 69 percent, from 80 percent. If Ford could maintain that pace for a full year, the Mach-E would easily set a sales record for an E.V. not built by Tesla.

Tesla’s 326-mile Model Y Long Range still squeezes a few more miles from each onboard kilowatt-hour, owing to the carmaker’s expertise in aerodynamics, motor and battery efficiency, and to “simple” stuff that’s anything but: Its 4,416-pound curb weight undercuts the Ford by about 400 pounds. And Tesla rules the public charging space, with its Supercharger network that has rivals — now with a potential infrastructure lift from the Biden administration — racing to catch up.

The Ford fires back with a sculpted exterior versus the dad-bod Model Y, a tech-savvy interior with superior materials and craftsmanship, and winning performance of its own. With 346 horsepower from dual motors, the Mach-E Premium A.W.D. that I drove shot to 60 miles an hour in 4.8 seconds. Even the new Shelby GT500 — history’s mightiest Mustang, with 760 horsepower — won’t equal the 3.5-second 0-to-60 m.p.h. blast of this summer’s Mach-E GT Performance version.

Voltswagen, as the company briefly convinced some media and car fans in a marketing stunt gone bad. Regarding historic names, VW calls the ID.4 its most significant model since the original Beetle. But where the Beetle was a revolutionary leader, the ID.4 feels like a follower.

Based on my drive, the VW can easily top its 250-mile range rating, with 275 miles within reach. A rear-drive, 201-horsepower model rolls to 60 m.p.h. in 7.6 seconds. That’s on a par with gasoline sport utilities like the Honda CR-V, but pokey by E.V. standards. Dual-motor, all-wheel-drive models arrive later this year, promising 60 m.p.h. in under six seconds.

From a company famed for fun-to-drive German cars, the ID.4’s generic performance and styling are letdowns. Its infotainment system is even more disappointing: The clunky, vexing touch screen can’t touch the onscreen wizardry of the Ford, Volvo or Tesla.

The VW’s snappiest performance came during a fast-charging session at a Target in New Jersey, replenishing its 77 kilowatt-hour battery from 20 to 80 percent in an impressive 31 minutes. That growing network of Electrify America chargers is funded by VW’s $2 billion, court-ordered penance for its diesel emissions scandal. And VW is offering indulgences to ID.4 buyers, with three years of free public charging.

Thrifty virtues include a $41,190 base price, or $33,690 after the $7,500 federal tax break. That’s $2,800 less than the most-affordable Mach-E. It’s also less money, after credits, than a smaller Chevrolet Bolt. The more powerful ID.4 with all-wheel drive will start at $37,370, postcredit.

Still, as Tesla’s triumph and Chevy’s lukewarm Bolt have proved, there’s more to electric success than an attractive price. VW is aggressively investing $80 billion to develop E.V.s, but the ID.4 feels less like a market splash and more like a toe in the water. We’ll see if VW erred by not kicking off with a recognizable design that truly connects its nostalgic, weed-hazed past to today’s green virtues: the electric ID.Buzz Microbus, due in 2023.

Volvo seems such a natural fit for E.V.s. And the progressive-minded brand brings us the XC40 Recharge, an electrified take on its gasoline XC40.

The Recharge is like that perfect dining table in a shelter magazine: You’re not sure why it costs so much, but you want it anyway.

The Recharge’s wedgy Scandinavian styling tops every S.U.V. in this group, as does its lovely interior. That includes soft Nappa leather, versus the ascetic “vegan” materials of many E.V.s.

The drive is similarly breezy, with 402 horses and a quicksilver, 4.7-second flight to 60 m.p.h. The biggest tech talking point may be Android Automotive OS: The Recharge (and Volvo’s electric Polestar 2) introduces a cloud-based Google operating system that works like a dream, with Google Maps, search, an ultra-capable voice assistant and more. (Don’t confuse this with the ubiquitous Android Auto, which simply mirrors phone apps on a car’s screen.)

Several major automakers, including G.M. and Ford, plan to make Android Automotive the nerve centers of coming cars. If only the Volvo itself were as efficient.

The Recharge is an electron guzzler, with a 208-mile range that seems optimistic in real-world use. I drove the Recharge in frigid New York weather, which explained some but not all of its hunger for power: No matter how I babied the throttle, the Volvo stayed on a pace for 190 miles, at best, covering about 2.4 miles for each kilowatt-hour in the batteries. I can achieve 3.6 miles per kilowatt-hour with little effort in the Tesla Model Y and above 3.2 in the Ford.

Environmental Protection Agency numbers bear that out: Despite having virtually the same-size battery, the Tesla brings 326 miles of maximum range, 118 more than the Volvo. The Recharge is also expensive for its intimate size: $54,985 to start, and nearly $60,000 for the model I drove. That $7,500 federal tax break softens the blow. Yet if the Volvo indulges bourgeois buyers, they’ll also need to indulge its profligate ways.

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That Popular S.U.V. Is Going to Cost You

“It’s been a weird year,” Mr. Drury said.

That has driven up the average purchase price of a new vehicle to about $40,000.

Inventories of luxury cars are the lowest as buyers have pounced, while run-of-the mill sedans are relatively plentiful, said Ms. Krebs at Cox.

So if new cars are too expensive, you can just buy a used car, right?

Yes, but deals may be elusive there as well. Fewer people bought new cars last year, so fewer used cars were traded in. And the short supply of new cars is pushing more buyers to consider used cars, raising those prices, analysts say. The average price paid for a used car is well above $20,000, Edmunds says.

On the plus side, if you have a car to trade in, its value is probably higher, especially if it’s a popular model. The average value for trade-ins, including leased cars turned in early, was about $17,000 in March, up from about $14,000 a year earlier, according to Edmunds. The average age of trade-ins was five and a half years.

Various online services, like Kelly Blue Book, TrueCar and Carvana, will supply a trade-in estimate based on your location and your car’s age, mileage and general condition, and offer more tailored appraisals if you provide details like the vehicle identification number. Some even offer to buy your car outright.

If you trade in your car at a dealership, be sure to negotiate the price of your new purchase before you discuss the value of your trade, Consumer Reports advises.

And when you buy a used car, it’s important to have it inspected by an independent mechanic, to spot any potential problems. If a dealer balks at letting you do that, it may be best to shop elsewhere, Mr. Barry said.

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Why The Paint Job on Your Car is Crucial to its Resale Value

In 2017, a new Mazda MX-5 Miata RF, resplendent in Soul Red Metallic paint, listed for $35,901. By 2020 that jaunty two-seater had an average resale value of $24,112. If finished in stolid Machine Gray Metallic paint, however, that same model fetched an average of $1,046 less, thanks to the color alone.

Because many other factors influence car value, color is easy to overlook. Yet both paint and car manufacturers maintain international departments of stylists and colorists who not only monitor what consumers are buying but — drawing from the fields of art, architecture, fashion, popular culture and consumer research — predict what people will want up to five years in the future.

Decisions are exasperatingly complex. A popular color for sedans might not work for sports cars. A hit color in Florida might tank in Michigan. According to iSeeCars, a search engine catering to car buyers, the worst color for S.U.V.s was beige, which lost 46 percent of its value over three years. For pickup trucks the best color was … beige. Beige pickups lost only 18 percent in value in the same time period.

The importance of color to cars is almost singular. It’s nothing to chuck a formerly fashionable fuchsia T-shirt, and you can repaint a room in a weekend. But repainting a car costs thousands and requires skilled technicians. With the possible exception of kitchen appliances, there are few color decisions as costly that consumers live with for as long. In a routinely quoted poll from 2000, 39 percent of car buyers said color was more important than brand.

An iSeeCars analysis compared list prices for new 2017 cars with their resale prices in 2020 to see which colors hold value best in different vehicle classes. In addition, some larger paint manufacturers publish annual color popularity reports and predictions for the coming year. Combined, they help draw broad rules for picking the best values in car colors. And while color doesn’t wholly determine a car’s value, if it’s not part of a buying decision, you might get stuck with a gray Miata.

Paint is also about durability, not just aesthetics. It was intended to prevent rust. Henry Ford famously offered customers “a car painted any color that he wants so long as it is black.” Black paint was durable and inexpensive — and using a single color sped up production, said Matt Anderson, a curator at the Henry Ford museum in Dearborn, Mich.

“Popular myth says black was chosen because it dried fast,” he said, “but there’s no evidence that black dried any faster than dark greens or blues,” both among the colors that Ford initially offered.

By the mid-1920s, a DuPont paint formulation helped expand the palette, and color was used as a marketing device; General Motors’ Oakland Motor Car division advertised the True Blue Six model after its bright color in 1924. Even Ford Motor caved in when it needed a marketing boost in 1925.

“Colors then returned for the T’s final two model years in an effort to stimulate slumping sales,” Mr. Anderson said.

Cars came in more than a dozen hues by the mid-50s — the better to attract the female drivers of the family’s second car, the thinking went. Those colors became more vivid in the psychedelic ’60s.

Metal and paint technology upped rust resistance in the ’70s, and then a new process from Europe gained notice, said Clifford Schoff, a paint chemist who spent 30 years at the manufacturer PPG. Clear coating was about to arrive in America.

“We started hearing about the ‘wet look,’” Mr. Schoff said. “The color plus clear meant you kept a higher gloss for a longer time.”

Over the years, those technologies that improved the longevity of cars and paint may help explain the unprecedented 10-year run for white as the most popular color. Its functional advantages also help. White is good in hot climates and hides scratches and dings well, making it popular with fleet buyers.

“Rental car companies love white,” said Karl Brauer, executive analyst for iSeeCars.

But, as the iSeeCars data shows, there is a big gap between what is popular and what retains value.

The 2020 Color Report from the paint provider Axalta (formerly DuPont) said fewer than 1 percent of new cars on lots in America were yellow. Yet iSeeCars data shows yellow retained the most value over all. An overwhelming 30 percent of cars on dealers’ lots are white, followed by 19 percent for both black and gray and 10 percent for silver.

It’s the law of supply and demand. “It’s not that yellow is a popular color. It’s that yellow is popular in relation to how many people want it,” Mr. Brauer said.

“You can’t go wrong buying the popular colors — black, white or silver — but you can’t go right, either,” he added. The most popular colors generally fall in the middle of the value chart.

Rarity alone doesn’t guarantee value. Purple, brown and gold are about as rare as yellow yet retain the least value over all.

There are other anomalies, such as the previously mentioned beige paradox. Trucks did well in muted colors, possibly because, as work vehicles, those hues show less dirt and company names painted on the sides are easy to read.

S.U.V.s did best in flashy colors, possibly because the drivers didn’t want to feel like drudges.

“You are buying the S.U.V. to avoid the minivan,” said Jonah Berger, a professor at the University of Pennsylvania’s Wharton School with expertise in marketing psychology. A lively color, he said, “makes us feel like: ‘I am driving a fun car. I am a fun, exciting person.’”

Apparently minivan owners are focused on utility. Blue retained the most value, losing 39 percent, but that wasn’t much different from the worst, brown, at 42 percent.

This makes it difficult to assess the “best” color for a car. It might be better to consider the best color for a type of buyer.

“People buy things for different reasons,” Mr. Berger said. “Sometimes we buy them for what they do. Sometimes we buy them for what they say about us.”

People who buy cars for utility, like minivan and fleet buyers, seem to value subtle colors that are easy to care for. People who buy a car as a personal statement — sports- and muscle-car owners­ — value glitzy colors.

That still complicates the paint choice for vehicles that defy categorization. Jeeps and trucks are utility vehicles for some and showpieces for others, who bolt on lift kits, light bars and custom grilles. The Jeep Wrangler retained the most value in Xtreme Purple, a color usually at the bottom of the overall chart. Purple Wranglers kept $2,398 more value than the same model in utilitarian silver.

Color prognosticators agree that the new color to reckon with is blue. Last year it accounted for 10 percent of cars on lots, equal to silver. But which blue? Dark? Light? Metallic? People who make a livelihood from car paint see vast differences between shades of a single hue, even mundane white.

“The white we have is not the white we had 20 years ago,” said Paul Czornij, head of color design for car paint at BASF. A carmaker might ask him for “a white metallic that is a little bluish, and from this grazing angle it has this property, and from this angle is has that property,” he added. “That is very exciting.”

For consumers, those fine points appear to have little effect on value. The iSeeCars data shows that metallic paint’s value advantage over nonmetallic is insignificant.

Ultimately, many buyers may choose paint color disregarding both value and popularity to achieve a third goal, Mr. Berger said: “Maybe having a color that’s different than white makes you happy.”

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