When General Motors decided to pull the plug on a sedan plant in northeast Ohio almost two years ago, the Detroit-based automaker was reacting to America’s growing interest in trucks and SUVs.
The move eliminated more than 1,300 jobs, creating a headache for Lordstown, Ohio, and the local economy that depended on the factory, drawing the ire of President Donald Trump.
Lordstown Motors, an electric vehicle start-up that now owns the assembly plant in its namesake city, is giving the manufacturing site new meaning and hopes to employ more at the plant than its predecessor by the end of 2021. The company is manufacturing Endurance, an all-electric pickup.
“We’re in a race to bring this back to life and, you know, come out with the first electric pickup truck in the United States,” Steve Burns, the chief executive of Lordstown Motors, told CNBC’s Jim Cramer in a “Mad Money” interview.
Lordstown Motors, which bought the site from GM and began trading on the Nasdaq in late October via a special purpose acquisition, expects to double its staff at the plant to 500 by the end of next month and hire another 1,500 workers there in 2021.
The company is trying to restore purpose in the local community after GM ended production of the slow-selling Cruze sedan, the only vehicle being assembled at the factory, which operated there for five decades.
“It had been here for 53 years and shut down kind of abruptly, so a lot of pain in the area,” Burns said.
An exterior view of the GM Lordstown Plant on November 26, 2018 in Lordstown, Ohio.
Jeff Swensen | Getty Images
Shares of the electric vehicle company jumped nearly 10% on Tuesday, which came one day after the stock rose 26% on news that it was receiving large inquiries from commercial fleets for the Endurance truck. The vehicle is slated to launch in the second half of 2021.
Lordstown Motors’ market value reached $4.1 billion at Tuesday’s close with shares at $24.70.
While the company said it has received about 50,000 production reservations, which are nonbinding, the average fleet order is for 500 vehicles. Some of the businesses showing interest include Duke Energy and FirstEnergy.
In the interview, Burns highlighted the role that GM has played in getting the plant up and running, going beyond just selling the location to Lordstown Motors. The traditional automaker in May 2019 committed $700 million to back the operation and establish hundreds of jobs there, along with in-kind contributions to get the business going.
“The relationship started as just a quick asset sell — they were just going to sell us a factory — and it slowly migrated into something much richer,” Burns said.
“They’re one of the pipe investors, along with, you know, long-term institutions like Fidelity [and] BlackRock, but they of course bring more than money,” he said of GM. “They bring a great relationship.”