What is Lordstown Motors?
In November, GM sold its Lordstown assembly plant to a new company called Lordstown Motors Corp., which is closely tied to another start-up called Workhorse Group Inc.
Lordstown Motors plans to build electric pickup trucks.
Here's some answers to questions you may have been wondering about when it comes to Lordstown Motors:
What’s Workhorse, what’s Lordstown Motors and what’s the difference?Lordstown Motors CEO Steve Burns acknowledges it can be hard for people to delineate.
- Burns founded both and was CEO of Workhorse before he left nearly a year ago to form and become CEO of Lordstown.
- Workhorse, based in southwest Ohio, started 12 years ago in southwest Ohio to build electrically powered utility and delivery vans. It struggled financially in the past year.
- Workhorse developed a prototype of an electric pickup called the Endurance three years ago.
- Workhorse has licensed the pickup truck technology to Lordstown Motors and has turned preorders for the truck over to Lordstown. In exchange, it owns a 10 percent stake in Lordstown and gets a 1 percent commission on the first 200,000 trucks sold.
- Workhorse is in the running for a $5 billion contract to build electric vehicles for the U.S. Postal Service, which Lordstown Motors anticipates building.
What were the terms of the sale of the GM plant?The sale price was approximately $20 million. GM confirmed it has extended loans of up to $50 million because of delays in the sale caused by the nearly two-months strike by GM workers this summer. The deal also includes a buy-back option from GM that expires May 30, and options for GM to lease land and plant space from Lordstown Motors.
What about tax abatements and other public incentives?None have been publicly disclosed. But the discounted price of the plant is expected to cost nearly a million dollars in property taxes.
What other money is going into this project?Lordstown Motors has retained the investment bank Brown Gibbons Lang & Co. to raise $450 million in private investment.
Why did GM pick Lordstown Motors?GM says it felt the start-up offered the best chance to restore vehicle production at the assembly plant, has a sound design for the pickup and has a a deep bench of talent and technological know-how, including its hiring of Rich Schmidt, the former director of manufacturing at Tesla.
How many jobs? Burns says the company plans to start with a workforce of 400, but hopes to fill the entire 6 million square-foot plant.
Will it be unionized? “If the workforce decides to unionize,” said Burns, “we are accepting of that.”
What will pay be? Burns says the company will pay be competitive; “our goal is to be great to our employees.”
What’s the timeline? The company hopes to start making prototypes in April and be in full production by November.
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