Workhorse Motors to Take Over Shuttered GM Plant in Lordstown

[Okie + 83]

https://electrek.co/2019/05/08/gm-lordstown-workhorse-electric/

Donald Trump tweeted today that GM would be selling its recently shuttered Lordstown, Ohio plant to Workhorse to build electric (pickup) trucks.

 

Trump said he spoke to GM CEO Mary Barra, who told him of the impending deal.

Edited May 9, 2019 by Okie
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[Jan van Eck + 7,558]

2 hours ago, Okie said:

Donald Trump tweeted today that GM would be selling its recently shuttered Lordstown, Ohio plant to Workhorse to build electric (pickup) trucks.

GM is not selling that Lordstown plant.   And certainly not to another auto builder.  And especially not to some electric-pickup builder - who will be competing with GM for GM's Chevy Truck customers.  That is not going to happen.

First up, that plant is ten million square feet.  There are guys in California who buy up old industrial plants and re-purpose them.  GM has sold some plants  (I think in Flint, at least, and the one in Delaware possibly) to those guys.  The price runs over $10 a foot. So that little start-up would have to drop $10 million of their working capital into real estate.  They do not have the ability to do that. 

So what would happen, if it happens at all, is that GM will craft a new JV entity and that JV entity will rent the plant out to "Workhorse."  And part of that deal will be that the metal-stamping part of the plant will remain under the GM control and that the UAW union workers laid off will be first up for running the stamping line.  Those are old presses in there and only those guys are able to run them with any output speed.  And possibly other union jobs will be reserved for the paint shop, that sort of thing.  And GM will get a technology license for the battery pack design and other cute ideas that Workhorse develops, and I suspect also first right of refusal on purchase of the entire Workhorse company at some pre-determined price, even if it ends up below market cap, with the Workhorse shareholders in some forced sale. 

But the other reality is that the Lordstown plant is just gigantic.  It is way too big for some specialty builder.  They would not be able to pay the heating bill.  So it has to get re-purposed into "something else."  My guess is that it becomes some sort of aircraft assembly plant, and that boulevard out front has the light poles taken down and converted into a runway.  Hard to imaging what else that plant would be used for.