General Motors’ closure of its Lordstown, Ohio plant met with much criticism, but the company seems to looking to provide a soft landing for the folks who seemed to depend on it financially as the company revealed it’s providing the new owners of the site with a $40 million loan.
The company is making actually as much as $50 million available to Lordstown Motors Corp. to purchase the plant. The company, whose parent Workhorse already builds a variety of battery-electric vehicles, is planning to build electric trucks at the site, which most recently built the Chevy Cruze.
“The transaction was structured to support LMC’s strategy to launch production of their Endurance pickup,” GM spokesman Jim Cain said in an email to the Free Press. “But we’re not commenting on the terms.”
It’s the second time in as many weeks that GM’s been mentioned in the area. Last week, the company announced it was partnering with LG Chem to build a new $2.3 billion joint venture to produce batteries for EVs.
The project will get underway with the construction of a new lithium-ion battery plant in Lordstown, near the site of the assembly plant GM closed earlier this year. The factory will be a “critical” piece in the automaker’s effort to bring to market battery-cars that can meet consumer expectations in terms of price and range, said GM CEO Mary Barra.
The new facility, which is expected to create about 1,100 new jobs, will be essential to meeting the increased demand for batteries that will come with the expansion of the GM product portfolio, said Barra. In the process, that also will have a “significant impact” on driving down costs, the GM CEO stressed.
Specific details, such as the capacity of the plant, were not revealed. But GM said it expects the facility to be able to supply its battery needs for all the BEV models it plans to bring out in North America – at least in the near-term. Eventually, Barra noted, battery-electric cars are expected to gain a major share of the market and that would likely require additional facilities.
The decision to locate the battery factory near GM’s now-abandoned Lordstown assembly plant was clearly not a coincidence. The automaker has taken numerous hits over its decision to close the operation there, among other things from President Donald Trump.
Terms for repayment were not disclosed on a mortgage document uncovered by the Business Journal Daily of Youngstown; however, GM has an option to repurchase the facility and all transferred assets, and holds the option to lease 500,000 square feet of the factory and another 400,000 square feet of land.
GM sold the 6.2-million square-foot facility Nov. 7. The plant shut down in March, at which time GM relocated most of the 1,600 workers there to GM jobs at plants in other states. GM CEO Barra reinforced that during the press conference announcing the deal with LG Chem, adding that the EV battery plant could hire former Lordstown workers, but they would have to apply for openings just like anyone else.