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Start-Up Automaker Takes Over Old GM Plant

Elio promising an affordable 3-wheeler by 2014.

by on Jan.04, 2013

Elio plans to sell the tadpole-shaped 3-wheeler for just $6,800. It promises up to 84 mpg.

A small start-up that hopes to begin producing a new high-mileage automobile in mid-2014 has taken over an abandoned General Motors plant near Shreveport, Louisiana.

Elio Motors plans to use about a third of the 1.8 million square foot facility, one of 89 properties GM shuttered in the wake of its 2009 bankruptcy.  The company hopes to begin hiring the first of 1,500 new workers about a year from now, though it is unclear whether it will seek out the employees who previously staffed the GM facility.

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“We go into production 18 months from now, and so we will begin hiring around 12 months from now,” said Elio CEO Paul Elio.

The plans call for the production of a significantly different vehicle than what GM had previously built in Shreveport, which included a small Hummer SUV and, just before the factory’s closure, the midsize Chevrolet Colorado and GMC Canyon pickups.  Elio is developing a tadpole-shaped 3-wheeler that promises to deliver high mileage for a low price tag.

The Shreveport plant was one of several dozen facilities GM gave up as part of its run through Chapter 11, but it continued to lease the assembly plant from the trust created to dispose of those properties. Production of the Colorado and Canyon models wrapped up last August, and the facility was turned over to the Revitalizing Auto Communities Environmental Response, or RACER, Trust.

RACER has so far disposed of 25 of the 89 abandoned GM properties in 14 states.

“There were three driving factors in the purchase of the plant: The business-friendly economic environment; the quality of the local experienced workforce; and our unwavering commitment to build Elio vehicles in America, with American workers,” Elio said.

On its website, Elio describes its new car as “the next big thing in transportation.” While details are sparse, it expects to sell the vehicle – which features two wheels up front and one in the back – for $6,800.  It will feature three airbags and the company aims to earn a five-star federal crash rating.

But the big selling point could be the promise of fuel economy of as much as 84 miles per gallon.

“This will make a difference in people’s lives,” Elio said during a ceremony at the Shreveport plant. “In middle America, you can afford to have both this and your minivan or this and your Yukon. It will save money, it will help our environment and it will create jobs here in America.”

Such bold promises may be generating enthusiasm in Shreveport but there are plenty of skeptics elsewhere.  A number of entrepreneurs and environmental enthusiasts have been looking for ways to challenge the established automotive order but have so far failed to make much of a dent.

A California-based start-up, Next Auto, had also hoped to acquire the Shreveport plant but abandoned the bid when it failed to win a much-needed federal loan guarantee.

A number of ventures based around high-efficiency battery propulsion have also failed, including Think and Bright Automotive. Two others, Fisker Automotive and Tesla Motors, have gone into production but are struggling to pay their bills.

But where many of those start-ups have focused on expensive battery technology Elio is confident that he can strike a responsive chord by offering an affordable, gas-powered alternative to used car owners “having to say a hail Mary before turning the key each day hoping to get to work or school.”

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3 Responses to “Start-Up Automaker Takes Over Old GM Plant”

  1. Jorge M. says:

    Expect this company to be short lived…

  2. Sidney says:

    I read this article and I scoured Elio’s website: other than being able to select an Auto or Manual trans, nothing of the drive train is mentioned; I’m assuming an air-cooled motorcycle engine.

    And yes, I could be interested in this vehicle. But no, no “up-front” dollars for a T-Shirt and a dream.

    I’ll wait.

    • Paul A. Eisenstein says:

      My thoughts, entirely, Sidney. I have no clear sense of what they’re building or whether it will be remotely acceptable to drive. Let’s wait to hear more.

      Paul A. Eisenstein
      Publisher, TheDetroitBureau.com