GM tries to soften the blow of Lordstown plant’s death

If General Motors is so con- fident that the prospective buyer it’s touting for its idled Lordstown plant is primed for success, why isn’t it investing in the start-up company?

The simple answer is that GM Chief Executive Officer Mary Barra didn’t reach the pinnacle of corporate America by making dumb decisions.

By any measure, investing in a company with no name and without the financial wherewithal to buy the enormous Lordstown assembly complex would expose Barra to harsh criticism from GM’s shareholders. They’re only interested in the bottom line, and right now GM is raking in the dough.

The closing of the Lordstown plant and four other manufacturing facilities in North America is part of the company’s long-range goal of cutting expenses while increasing revenues. It plans to eliminate 14,000 jobs worldwide.

Thus, when Barra, who met Wednesday in Washington with members of Ohio’s congressional delegation, gushes about the potential sale of the 53-year-old industrial fixture in the Mahoning Valley, we take what she says with a healthy dose of skepticism.

Last month, President Donald Trump preempted an announcement by GM that a newly formed affiliate of Cincinnati-based Workhorse Group was interested in buying the Lordstown plant to build electric vehicles.

Trump’s supporters in the Mahoning Valley hailed the news as the Republican president keeping a promise to the Valley. However, Republican Gov. Mike DeWine warned against premature elation, noting that Workhorse’s plans depend on the company securing a major contract with the U.S. Postal Service for electric delivery vehicles.

There are several big-name companies vying for the contract, which means there’s no guarantee Workhorse will be successful.

Nonetheless, GM CEO Barra insists there’s reason to be optimistic.

“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,” she told Reuters news service after her meeting in Washington with Ohio’s two senators, Democrat Sherrod Brown and Republican Rob Portman, Valley Congressman Tim Ryan of Howland, D-13th, and others.

Public relations stunt?

Reuters asked Barra if the Workhorse deal was a public relations stunt. She said “no” and added, “We vetted many opportunities.”

But while the potential sale of the Lordstown assembly complex is uncertain, at best, this much is clear: General Motors has no plans to restart its Valley operation.

Barra’s refusal to assign another vehicle to replace the top-selling Chevrolet Cruze leaves little doubt that the complex will remain closed even if the Workhorse project falls through.

“We want to see General Motors in this plant,” Sen. Brown said. “We want an electric vehicle. They’re making 20 electric vehicles [models] by 2023. That’s their plans. She wouldn’t commit to me when I asked her” to put an electric sedan at the Lordstown facility.

Ryan, who is running for president and has demanded that President Trump commit $1 billion to upgrade the plant so GM can build electric cars there, said he isn’t optimistic “about anything from General Motors going in there.”

“There’s not a lot of hopefulness coming from General Motors on Lordstown. People in the community are going through a lot. It’s a shame they [GM] got tax cuts and all the benefits, and we get screwed.”

Just three years ago, the Lordstown facility, which had earned a global reputation for building the highest quality, technologically advanced, competitively priced compact cars, had a work force of 4,500.

But in 2017, GM eliminated the third shift with its 1,500 jobs, even though the Chevrolet Cruze was the top-selling vehicle in the company’s fleet.

The justification from Detroit was that consumer tastes were changing and that demand for trucks, SUVs and crossovers was growing while the popularity of sedans was declining.

Sen. Portman, who joined Brown and Ryan in pressing GM to assign another product to the Lordstown plant, said the effort will continue even though Barra remains noncommittal.

GM has said there’s additional unused U.S. capacity in the plants that are operating, which is why it has no intention of assigning another product to Lordstown.

Even if Workhorse does come up with the money to buy Lordstown, the number of workers will pale in comparison to the thousands who have walked through those doors.

Thus, despite Barra’s positive spin on the project, here’s the bottom line: GM has abandoned the Valley.