General Motors will be helping Lordstown Motors with a $40-million loan.
Lordstown Motors Corp bought the Lordstown plant owned by General Motors for $20 Million. The Lordstown plant in Ohio was idled and no work was going on in the plant when Lordstown Motors purchased it from GM.
Now, GM is helping Lordstown Corp to launch its first product Endurance the electric pickup. The company intends to launch its product by the end of 2020. The terms of the loan were not revealed.
The strike that took place by the United Auto Workers Union against General Motors lasted for 40 Days and had delayed the sale transaction between the two companies.
A memorandum of options has now been signed between them. According to this memorandum, GM can repurchase the plant or lease a portion of the plant from Lordstown Motors. The memorandum has been signed by CEO Stephen Burns of Lordstown Motors and Debra Hoge, the Global Director of Real Estate of General Motors.
Documents were signed in the first week of December toward this agreement. If necessary, GM will be providing up to $50 Million toward this open-ended mortgage to Lordstown Motors. The 6.2 million square foot land was sold to Lordstown in March. Workers have been relocated to other GM offices.
General Motors has plans to bring in a battery cell plant in Northeast Ohio, jointly with LG Chem. These battery cells will be used by GMs own electric trucks. As customer preference has shifted to pickups and SUVs, GM had closed down four of its plans including its Lordstown plant, though it was heavily opposed by its union members.
Lordstown Motors plans to bring in trucks for commercial purpose, for those who need fleet vehicles. It will be raising $300 Million toward this production in its Lordstown plant. The company plans to hire about 400 workers in its plant.