General Motors is making a $40 million loan available to Lordstown Motors Corp. to help the start-up buy GM's shuttered plant in Lordstown, Ohio, and start building electric trucks.
"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."
Legal documents filed late last week and dated Nov. 7 said GM held an open-ended mortgage that enables Lordstown Motors to borrow up to $50 million from GM if necessary, the Business Journal Daily of Youngstown reported.
Terms for repayment were not disclosed on the mortgage document, but a separately filed memorandum said 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.
Distrust in the ranks
GM sold the 6.2-million square-foot facility to Lordstown Motors Nov. 7 after idling the plant in March. It relocated most of the 1,600 workers there to other GM jobs in different states.
GM had built the Chevrolet Cruze subcompact car there, but in November 2018 the automaker said it would close four U.S. plants, Lordstown being one. It was ending production of some of its sedans as customer preference shifted to SUVs and pickups.
This latest news offers little comfort to some 400 former GM Lordstown workers who remain in the area, having taken a buyout rather than uproot their families to move to a GM job out of state.
"The vast majority of us who lived through this entire story since last November don't trust GM," said Tim O'Hara, UAW Local 1112 president in Lordstown. "There is a lot of suspicion that once it's all said and done that GM itself will end up building electric vehicles in Lordstown after all its loyal employees and Local 1112 members had to move throughout the nation."
Lordstown Motors said it will build the Endurance electric pickup using components licensed from Workhorse of suburban Cincinnati. The Endurance, which is expected to sell for about $50,000, is designed for fleet sales, the company said, and is a lightweight, all-wheel drive vehicle with a low center of gravity.