President Trump Says Lordstown is Saved! But… Is It?
President Trump took a break from his normal Twitter routine on Wednesday afternoon to break a piece of honest-to-goodness news:
Trump is referring to the General Motors Lordstown plant in Ohio, which is one of five North American plants that General Motors announced in November would be shut down, eliminating thousands of jobs.
The Lordstown plant officially closed in March, leading to 1,400 layoffs. Although some of the Lordstown workers have landed at other GM plants, others are still looking for work.
The Lordstown closure was devastating for Ohio’s Mahoning Valley, which had depended on the factory as a pillar of its economy since it opened in 1966. For his part, Trump took the news of the Lordstown closure pretty personally. After all, he visited nearby Youngstown during the 2016 campaign and famously declared, “Those jobs have left Ohio — they’re all coming back. Don’t move, don’t sell your house.”
When Trump tweeted out Wednesday afternoon that GM had sold the Lordstown factory — and to Workhorse, a company that wants to use it to make electric trucks! — it seemed like great news.
But once you start looking at the details, it’s not so clear any of this is going to pan out.
First, there’s the United Autoworkers (UAW) union. Trump notes in his tweet that the GM sale is “subject to a UAW agreement etc.,” and well… the union isn’t exactly enthused about the whole thing. Here’s a statement from UAW Vice President Terry Dittes:
In response to General Motors’ announcement today, the UAW’s position is unequivocal: General Motors should assign a product to the Lordstown facility and continue operating it.
A federal lawsuit filed by the UAW over the closing of the Lordstown, Baltimore and Warren facilities is still pending, and the UAW will continue its effort to protect the contractual rights of its members at these locations.
You can’t blame the UAW for not exactly jumping at the chance to help GM out here. As Matt McMullan wrote in April, the UAW and its members gave up a whole lot to try to keep Lordstown up-and-running — and the plant was making a profit! — but GM decided to shut it down anyway.
But even if the union didn’t have to approve the deal, there still are a number of other red flags.
Ohio Gov. Mike DeWine didn’t even know it was happening when Trump posted his tweet, and had to talk to GM CEO Mary Barra to get details. When he got off the phone, he was pretty subdued, saying, “I’m just by nature a cautious person.”
Hmmm.
Then later on, DeWine noted that not only does the UAW have to approve the deal, but the U.S. Postal Service must pick Workhorse as a supplier for a $6 billion contract to provide the electric vehicles for its fleet.
Now, Workhorse is a finalist for the contract; the decision is expected to happen this year. But even if Workhorse lands the deal, it’s not certain the vehicles will be built in Lordstown.
Oh, and then there are concerns about Workhorse itself. The Cincinnati-based company “has no experience in mass vehicle production, its shares recently traded for less than $1, and quarterly revenues were less than the price of one high-end sports car,” the New York Times reported.
Like we said, it’s not so clear any of this is going to pan out.
Although Trump was pretty excited, Ohio politicians' reactions were more mixed. Sen. Sherrod Brown (D-Ohio) told the NYT that it’s “still too early to tell whether the sale is good news for workers.” Rep. Tim Ryan (D-Ohio) was cautious but optimistic, saying that “all in all it’s a net positive, because there’s something going in the facility.” Sen. Rob Portman (R-Ohio) tweetedthat he’s “optimistic about the news” and “hopeful that this news will benefit workers.”
But just like another deal that’s gotten a lot of attention lately, there are a lot of things to be worked out before workers can get back to work at the historic plant — and as AAM President Scott Paul told the NYT, Trump “is no stranger to grandiosity when it comes to job claims.”
“Foxconn is in limbo and virtually no one believes it will live up to the billing,” he said.
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Reposted from the AAM
