Two plants on the chopping block at General Motors might have found new life, but their futures remain works in progress, and even the best outcomes are unlikely to save most of the jobs being lost.
In Ohio, GM is in early discussions to sell its Lordstown Assembly Plant to Workhorse Group Inc. for production of electric vehicles, while in Ontario, Oshawa Assembly will turn into an aftermarket parts hub under an agreement reached last week with Canada’s auto union.
Both deals, if completed, would have similar outcomes: much smaller work forces, long-term uncertainty and a lesson in how difficult it is to replace or save factory jobs when automakers decide to shutter a major plant.
GM’s plan for Oshawa keeps only about 300 of the 2,600 jobs being cut there, and experts say there’s no plausible scenario in which Workhorse, without additional product commitments by GM or a third party, could keep more than a few hundred people at Lordstown, which as recently as three years ago employed 4,500 workers in economically challenged northeast Ohio.
While plans for Oshawa have been agreed upon by GM and the Unifor union, the potential Lordstown deal could fall through and there are many unknowns about Workhorse and its plans for the plant.
Workhorse, a little-known EV maker near Cincinnati with fewer than 100 employees, has been unprofitable since its founding in 2007 as AMP Electric Vehicles and ended the first quarter with just $2.8 million on hand — most of it borrowed. One day before President Donald Trump declared the potential sale to be a done deal and “great news for Ohio!” in capital letters on his Twitter account, publicly held Workhorse told regulators that it was in danger of becoming insolvent by midyear.
GM said it was negotiating with an entity led by Workhorse founder Steve Burns, who stepped down as CEO in February but remains on the board of directors. That board is led by Ray Chess, who had responsibility for crossovers and commercial trucks during a 37-year career at GM. Workhorse said it would hold a minority stake in the new company, which was created to buy Lordstown, but few other details, including a funding source, are known.
That GM viewed the company as serious enough to open discussions helps legitimize Workhorse, but the EV maker’s ability to accomplish such a massive undertaking remains “a big wild card,” said Jeff Schuster, president of global forecasting at LMC Automotive.
“I think we’re missing some of the story,” Schuster said. “Obviously, they’re an extremely small player, and there are a lot of questions.”
GM in March idled Lordstown, which made the Chevrolet Cruze compact sedan, as part of a massive restructuring. Lordstown and Oshawa are two of five North American plants that GM in November said it would idle this year and potentially close to reduce overcapacity.
GM has been working to transfer laid-off workers or assist in finding them other jobs. As of last week, it said more than 1,350 employees from Lordstown and other plants have accepted transfers.