General Motors Co. is in discussion with Workhorse Group Inc., based in Cincinnati, and an affiliated, newly formed entity to sell the company's Lordstown Assembly Complex.
General Motors Co. is in discussion with Workhorse Group Inc. and an affiliated, newly formed entity to sell the company's Lordstown Assembly Complex.
The move has the potential to bring significant production and electric car assembly jobs to the facility, a GM press release.
However, Travis Hester, GM Canada president, said that Wednesday's news will save 300 out of 2,600 unions at the facility.
For Lordstown, Mike DeWine says that much must happen before GM can sell its Lordstown plant to Workhorse. Firstly, he said that he is an agreement with United Auto Workers, representing workers at the vacant GM factory.
Also, Workhorse, a company in the Cincinnati area, must succeed in landing a contract to sell electric trucks to the US Post Service, he said.
"We have a long way to go," said DeWine The Vindicator. "Caution is probably the right word."
Getting that USPS contract seems to be the key to Workhorse's future at the vacant GM factory in Lordstown.
"It's not the day to celebrate yet for Mahoning Valley or Lordstown or the workers," DeWine said. "In order for this to work properly, it will be important for Workhorse to get the contract with the postal service."
DeWine said he was going to take a delegation to meet postal workers.
DeWine said he spoke on Wednesday to Mary Barra, GM's CEO, who told him when Workhorse was up – and he didn't have a final timeline – the company would start with "hundreds of jobs." He added that another person near the negotiations, who he did not reveal, said "it can be up to 3,000" if it lands the USPS contract.
A decision on this contract is months away, but Workhorse is among the five finalists for it.
USPS spokeswoman Kimberly Frum said they tried five prototypes for the service's next-generation delivery vehicle wrapped in March. The project is expected to be offered this summer, she said. She could not comment further on the contract.
DeWine said he spoke to Barra about the potential sale after she spoke to President Donald Trump. The governor said he would do everything needed to provide state aid to Workhorse.
Lt. Gov. Jon Husted told The Vindicator he visited Workhorse years ago, and it's "trying to create a viable business model for electric trucks."
While the company has had financial struggles, Husted said many new tech companies didn't make any money.
"It's a company trying to make new products from the future," he said. "That's why the postal contract is so important."
News about the potential sale broke late in the morning when Trump tweeted that GM would sell the idle system: "GREAT NEWS FOR OHIO! Just talked to Mary Barra, General Motors CEO, who informed me that GM , subject to a UAW deal, will sell its beautiful Lordstown Plant to Workhorse, where they plan to build Electric Trucks, GM will also spend $ 700,000,000 in Ohio … "and" …. in 3 separate locations, creating further 450 jobs. I've worked well with GM to get this done. Thanks to Mary B, your great governor, and Senator Rob Portman. With all the car companies coming back, and much more, the US IS BOOMING! "
US Rep. Tim Ryan of Howland, D-13, was less optimistic about the proposal.
"It doesn't seem to have much impact on short-term workers," the Democratic presidential candidate said. "They have to chase a job and retire elsewhere with General Motors. It will take some time to get the deal done. But in the long run, if they get the post contract, they can create jobs in the coming years."
Ryan said He spoke to Workhorse officials on Wednesday.
"I don't know much about them," he said. "They have a few small offers. They aren't there yet. They hope to get there. It's better than the plant is empty. I'm cautiously optimistic."
Dave Green, UAW Local 1112 president, said he didn't want to Be a "negative Nelly", but he does not yet know enough to say whether it would be good or bad.
"It was really a surprise to myself, and I'm sure our members," he said about the tweet drum team. "It's really too early to say how it will affect our members."
Green spent a lot of Wednesday driving a forklift on the plant and cleaning up things.
"Of course, they are clearing for something. Maybe now we know what," he said.
GM completed the production of Chevrolet Cruze at the 53-year-old factory in March, and eliminated about 1,600 jobs left at a facility that once worked more than 10,000.
Green said many GM Lordstown workers have accepted involuntary offerings to move to another GM plant, which he previously described as a movement or "you will lose everything."
He has not yet been offered an involuntary offer, but he expects him to be, in the end. Because he has two daughters in college and college and cannot afford to be without health insurance, he must say yes.
"I have to go," he said. "I cannot leave the healthcare that I receive for my children, my retirement or post-
pension on the table and go away. I would have to chase it."
Asked if GM citizens could make the transition to build electric cars, he said, "Absolutely. We have the best workforce in the world. I would argue Northeast Ohio, the work ethic here is truly second to none … … face a challenge ahead of us, and we're ready to face that challenge. "
Workhorse Group Inc. was founded in 2007 to produce electrical supplies and utility vehicles.
Its products include electric trucks, medium-sized and light-duty trucks and delivery drums.
The company's shares increased 214 percent Wednesday after Trump's tweet announced that GM sold the plant to Workhorse.
But the company has experienced the latest economic battles, according to Seeking Alpha, a content service agency offering financial and stock market analysis.
The website reports that Workhorse spent $ 21.8 million in net sales of $ 800,000 in operating activities in 2018.
In January, Search Alpha reported that the "lurking" electric vehicle developer announced a $ 35 million financing agreement with Marathon Asset Management, six months after the firm completed its last $ 6.1 million deal for a long-term loan with a fund managed by Arosa Capital Management.
The stock, WKHS, closed at $ 2.65 Wednesday, up 214 percent.
By final agreement, the unit, led by Workhorse founder Steve Burns, would overthrow the Lordstown facility. Workhorse will have a minority interest in the new unit.
"This potential deal creates a positive outcome for all parties involved and will help strengthen the leadership of the Workhorse role in the EV community," said Workhorse CEO Duane Hughes.
Burns added: "The first vehicle we would plan to build if we were to buy the Lordstown complex would be a commercial electric pickup, blending Workhorse's technology with Lordstown's manufacturing expertise."
Discussions between GM and Workhorse and the related recent formed entity started earlier this year, said Jim Cain, General Motors' general manager of news relations. He said Workhorse approached General Motors to acquire the plant.
Tim Colton, senior analyst at Gateway, a consulting firm contracted with Workhorse, refused to disclose the details of the unit. Workhorse will be a minority interest, or stake in the potential agreement.
"The plan would be to have the separately created business unit that would then license the technology from Workhorse," he said.
UAW HAS A ROLE
Cain said GM has had ongoing discussions with UAW about the impact of falling passenger demand worldwide.
"These discussions will be expanded to include this opportunity. We look forward to having constructive discussions. They will begin as soon as they can be arranged," Cain said. "Our assessment of this opportunity came to the point where we felt it was important to disclose it and begin the next phase of the discussions."
Portman said he spoke to Barra on Wednesday about the potential sale of the Lordstown facility.
Portman, a Cincinnati Republican republic, said: "My message to GM has always been to bring a new GM vehicle to the facility or to find a partner who will use this premier facility so people can get back I look forward to hearing more from Workhorse about the plans to bring jobs to Lordstown and I hope this news will benefit the workers there. "
Ryan said Workhorse sees UAW workers as" an advantage "but the association may seek opportunities for displaced GM workers to return.
After final agreement with all parties, the work could begin immediately to prepare for the Lordstown plant for new production.
GM also announced that it is creating 450 new production jobs in Ohio at its facilities in Toledo, Moraine and Parma.
Terry Dittes, UAW's National Vice President, said: "UAW's position is unambiguous: General Motors will award a product to the Lordstown facility and continue to run it. A federal lawsuit filed by UAW over the closure of Lords City, the Baltimore and Warren facilities is still awaiting, and the UAW will continue its efforts to protect the contractual rights of its members in these locations. "
He added:" The parties regularly discuss product issues during national negotiations, beginning in July this year. We will monitor this situation as it evolves to determine which action will most benefit UAW representatives at General Motors. »
James Dignan, Youngstown / Warren Regional Chamber CEO, said he had worked with DeWine's office and Jobs-Ohio to encourage GM to determine the fate of the Lordstown facility, but learned about the company's intentions through Trump's noon tweet.
"Until [Wednesday] we did not know that there was any incline in one way or another. The governor has always suggested," If you are never going to invest, then sell. "Now we have confirmation that the propensity is to sell. "
US Sen. Sherrod Brown, a Cleveland Democrat, said: "It is still too early to tell whether the proposed sale of Lordstown is good news for workers there. Workhorse is a leader in the manufacture of electric vehicles and we are proud to bring them to Calling Ohio home, but GM can't shirk responsibility for those workers. My No. 1 job is always fighting for the best outcome for Ohio workers, and that's what I will continue to do when we learn more. " Brown said he also spoke to Barra Wednesday and "she didn't have many answers. GM has a responsibility for his workers. GM can still put electric vehicles in Lordstown."
Lordstown Mayor Arno Hill said he is happy To hear that it is a buyer for the facility. He does not know how many Workhorse will employ, but he is optimistic, it will be a good form. He said his first choice would be for General Motors to bring a vehicle back to the facility.
Secretary of State Sean O & # 39; Brien from Bazetta, D-32, said it might take about nine to ten months to get the plant ready to produce its products, but it will take some time to conduct negotiations with the UAW to now an agreement that GM employees should have the facility.
"They are a good company. … They work with [U.S. Postal Service] to replace their vehicles, so it can be a significant financial benefit to our area," says B & B39.
Head of State Michael Rulli from Salem, R-33rd, added: "We'll do everything we can to help the UAW, and the company prepares the details and makes sure we don't get any snags."