G.M. in Talks to Sell Lordstown Factory to Maker of Electric Vehicles

During the 2016 election campaign, Mr. Trump promised to increase automotive jobs in the United States. Ohio, a state he carried, has been hit hard by the loss of manufacturing jobs.

In halting the Lordstown plant’s output of the Chevrolet Cruze — G.M. said the factory had been “unallocated” — the company eliminated 1,200 jobs. Some 450 workers had been transferred to other G.M. factories as of last month. Sales of the Cruze have dwindled over the last few years as consumers gravitated away from small cars in favor of trucks and sport utility vehicles. Fiat Chrysler stopped making midsize sedans and small cars in response to trend. G.M. and Ford are making similar changes.

G.M. said it was discussing its Lordstown plans with the U.A.W. The union on Wednesday called on the company to resume operations at the Ohio plant. “General Motors should assign a product to the Lordstown facility and continue operating it,” Terry Dittes, the union’s vice president, said in a statement.

G.M. and the U.A.W. are scheduled to start talks on a new labor contract in July. Automakers have in the past agreed to plant commitments in exchange for cost reductions from the union.

Workhorse is a small company, employing 98 full-time employees and reporting just $364,000 in revenue in the first quarter, according to recent financial reports. The company was founded in 1998 to take over production of delivery vans that G.M. had dropped from its lineup. Workhorse was acquired by Navistar in 2005 and began producing electric vans. Navistar later sold Workhorse to AMP Holding, which changed its name to Workhorse Group after the acquisition.

The company’s customers include UPS and FedEx, and it has several thousand orders for its electric trucks. It is hoping to win a contract to supply delivery vehicles to the United States Postal Service.

But Workhorse has struggled financially while preparing to increase production. In January it borrowed $35 million from a hedge fund, Marathon Asset Management.

Its stock was up about 90 percent on Wednesday afternoon.

Article source: https://www.nytimes.com/2019/05/08/business/gm-lordstown-trump.html?partner=rss&emc=rss