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GM still plans to sell Lordstown plant to EV startup after UAW strike

GM still plans to sell Lordstown plant to EV startup after UAW strike


But the new startup, Lordstown Motors, still needs money for the closed factory

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General Motors Ends Production At Lordstown Assembly Plant
Photo by Jeff Swensen/Getty Images

General Motors has reached an agreement with the United Auto Workers to end a month-long strike, and the automaker’s idling manufacturing facility in Lordstown, Ohio will officially close as part of the deal. But a planned sale of the facility to a new electric truck startup called Lordstown Motors, which is partially owned by struggling electric vehicle maker Workhorse Group, is still on, The Verge has learned.

“It’s still our intention to sell the plant to Lordstown Motors,” Jim Cain, GM’s senior manager for sales and executive communications, tells The Verge.

News of the sale to Workhorse was first announced by President Trump in May, who touted it as “GREAT NEWS FOR OHIO!” The president had previously berated GM for wanting to close the Lordstown plant, which was used to build the Chevy Cruze sedan, even going so far as to threaten that his administration would treat the automaker poorly.

The potential sale was initially seen as a boon for Workhorse, which was in some serious financial trouble at the time of the announcement. Despite having struck deals selling electric vans to Ryder and UPS, Workhorse has never been profitable. It is in competition to be selected as the vehicle maker for the United States Postal Service’s new vehicle, but in the meantime, the company posted a $36.5 million loss in 2018, and has seen losses accelerate in the first two quarters of 2019. Workhorse also recently sold off its budding passenger drone division for $4 million cash.

Workhorse itself isn’t trying to buy the factory, though. Instead, former Workhorse CEO Steve Burns founded a new startup called Lordstown Motors, which is partially owned by Workhorse. He’s spent the last few months trying to solicit investment for the purchase, and even recently hired Tesla’s former director of manufacturing operations.

Representatives for Workhorse and the UAW did not immediately respond to a request for comment.

Beyond the financial barrier, the deal between GM and the UAW still needs to be ratified by the union’s workforce — some of whom have already tried to push back on the closure of the Lordstown plant as a union shop.