June 02– Jun. 2–When word surfaced last month that General Motors had reached an agreement to sell the Lordstown plant, Mike DeWine advised caution. The governor made clear “this probably is not the day to celebrate,” stressing that he was “trying to be realistic.” He described the deal as “still a long ways away.” He expressed an understanding that raising false hopes would be “very cruel to the workers and the people in Lordstown and the Mahoning Valley.”
Jon Husted, the lieutenant governor, said similar things in joining the governor at the press conference. He called the prospective buyer, Workhorse, an electric truck manufacturer from the Cincinnati area, a “promising Ohio company.” Yet uncertainty hovered, the governor adding at one point: “For this really to work, it is going to take a contract with the United States Postal Service.”
Workhorse is one of the finalists for a $3.6 billion contract to supply the Postal Service with trucks, a decision expected sometime later in the year. That would make the company much stronger financially. It has received praise for the quality of its work. At the same time, a report in the New York Times last week raised questions about whether it would stay afloat until the announcement, Workhorse with under $3 million in cash at the end of March, suppliers requiring payment in advance and the company left to pursue high-interest loans.
Such doubt departs sharply from some initial enthusiasm about the GM deal. Recall President Trump getting in front of the automaker to tweet: “GREAT NEWS FOR OHIO! Just spoke to Mary Barra, CEO of General Motors, who informed me that, subject to UAW agreement etc., GM will be selling their beautiful Lordstown Plant to Workhorse, where they plan to build Electric Trucks.”
Not exactly, as DeWine and Husted realized, along with U.S. Sen. Sherrod Brown and U.S. Rep. Tim Ryan.
This isn’t to counsel little but gloom. Workhorse is ahead of competitors in having produced actual trucks, 365, mostly for United Parcel Service, according to the Times. Electric trucks have an obvious place in the future. Yet, as the Times reports, from its founding in 2007 to the first quarter of this year, the company lost $150 million.
In 2018, Workhorse revenues totaled $763,000. What if it doesn’t get the Postal Service contract? How would it raise the $300 million at a minimum necessary to get the Lordstown plant retooled and operating? What are the chances, realistically, of the Postal Service selecting Workhorse?
It isn’t hard to follow the thinking of GM. The automaker is seeking to get ahead of the industry curve, focusing on electric and autonomous vehicles. It is investing $700 million in other Ohio plants. More, at the time of the federal rescue, now a decade in the past, the company received harsh, and deserved, criticism for lacking vision and the flexibility to remain competitive. It wants to avoid repeating such mistakes, and that involves difficult decisions in the current challenging marketplace.
Still, it remains a puzzle for many around here that the automaker cannot find a place for a plant with a record of high-quality work, and long ties to the company. To be sure, many workers laid off at Lordstown have the option of transferring elsewhere within General Motors. That hardly makes up for the loss to the larger regional economy, the plant long a mainstay for middle class households, directly and indirectly.
In that way, many are rooting for Workhorse to overcome the obstacles in its path, the making of electric trucks carrying the promise to which the lieutenant governor referred. They also know there is nothing to celebrate, so many questions still without answers.
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