Published: Thu, May 09, 2019
Markets | By Otis Pena

GM in talks to sell Lordstown plant

GM in talks to sell Lordstown plant

The governor said GM CEO Mary Barra told him that her company and Workhorse have reached an agreement to sell the plant, pending approval from the United Auto Workers.

The potential sale, first announced on Twitter by President Donald Trump, could preserve some jobs at the sprawling plant 60 miles east of Cleveland.

The UAW said on Wednesday in a statement GM should add a new product at Lordstown "and continue operating it", adding it would continue with its federal lawsuit against GM to protect the contractual rights of its members.

GM closed the Lordstown plant in March, laying off 1,400 workers.

GM spokesman Dan Flores said the deal has the potential to bring a significant number of production jobs back to Lordstown. "The General Motors workers are being asked to leave and go to other facilities".

Workhorse shares jumped almost 70 percent on Trump's tweet and were briefly halted.

Should this sale finalize, the fate of the plant - widely thought to be in the hands of negotiators with the UAW and GM when they sit down later this year to hash out a new collective bargaining agreement - already will have been sealed and GM won't be part of its future.

GM confirmed the talks on its website, stating Workhorse and an affiliated, newly formed entity led by Workhorse founder Steve Burns, would acquire the facility.

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Burns added, "The first vehicle we would plan to build if we were to purchase the Lordstown Complex would be a commercial electric pickup, blending Workhorse's technology with Lordstown's manufacturing expertise". CEO Duane Hughes, who left newspaper publisher Gannett Co.to join Workhorse in February, called the potential deal with GM "a positive outcome for all parties involved".

"So we're certainly going to be urging the post office to grant that contract", said Ohio Governor Mike DeWine.

Hourly employees from GM plants may request a transfer to other UAW-represented sites as jobs are created. It also reported $2.8 million in cash and short-term investments. "GM will also be spending $700,000,000 in OH".

Also, Workhorse and another company have partnered to bid on a contract for the U.S. Postal Service's "next-generation delivery vehicle".

The decision came after GM faced months of criticism over its plan announced in November to close five North American plants and cut 15,000 jobs.

The president jumped behind his support for a new automobile company to occupy the space after GM announced it was ceasing production, leaving 1,700 Lordstown workers out of a job.

The VT Hackney / Workhorse collaboration is the only truck in the running that is electric.

But the remainder of the 2,600 workers at the plant in Oshawa, near Toronto, are still scheduled to be laid off.

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