Barra Says Closing of GM Lordstown is Not a “PR Stunt”

“We remain thinking it’s a strong possibility and think people should focus on opportunity, and maybe every now and then a little optimism wouldn’t hurt anyone,” said Barra.

Workhorse plans to build electric trucks, aircraft and drones, but is lacking the capital to fund the purchase of the Lordstown facility. The company is a finalist in a $5 million bid to replace the U.S. Post Office fleet and badly needs the contract.

“Our existing capital resources will be insufficient to fund our operations through the first half of 2019,” said Workhorse. “If we are not able to obtain additional financing and/or substantially increase revenue from sales, we will be unable to continue as a going concern.”

Workhorse saw revenue drop from $10 million in 2017 to $763,000 in 2018 and recorded a net loss of $36.5 million for the year. First quarter 2019 results showed revenue of $364,000 and a net loss of $6.3 million.

Lordstown was opened in 1966 and produced 16.3 million vehicles, including the Chevy Cruze, before the recent shutdown. The facility has 6.2 million square feet on 905 acres. About 850 of the 1,435 hourly workers at Lordstown have been placed in other jobs at GM.

GM on Tariffs

GM is also trying to cope with the import tariffs on China. The company was denied an exemption to the 25 percent China tariff for its Chinese-made Buick Envision SUV. In its exclusion request, GM hinted that it may have to drop the vehicle from its line in the United States if the petition was not granted.

A spokesperson for Buick following the denial said, “At this time we do not have any plans to adjust the volume or price of the Envision in the United States and will comply with all trade rules.”