Workhorse has come under increased scrutiny as it and an unknown entity work to purchase the General Motors Lordstown plant from the automaker. Discussions remain ongoing, but local officials, state officials, and Ohio’s two U.S. senators have voiced concerns.
For now, Workhorse will live another day thanks to a $25 million investment to keep things humming along. The company said it raised the millions of dollars from a group of unnamed investors. Crucially, the money will be used to simply keep the lights on and hopefully finish work on its electric delivery van.
Workhorse is a finalist to build and replace the seriously old Grumman LLV mail vehicle the U.S. Postal Services operates.
However, the Workhorse has said it’s not interested in building its electric delivery van at the Lordstown plant, and instead wants to build a commercial electric pickup truck. The whole deal remains shrouded in mystery. While first reports named Workhorse itself as the interested party, former Workhorse CEO Steve Burns said it would be a new entity along with Workhorse. The new entity doesn’t have a name and basically exists only on paper. Reports from last month said the entity needs to raise $300 million to make the purchase viable. Workhorse would have a minority interest in the new, unnamed entity.
The long-shot fundraising, and Workhorse’s less-than-stellar balance sheet, have produced widespread skepticism from everyone except GM. Workhorse reported revenue of $364,000 in the first quarter of this year, down from $560,000 at the same time last year. It also recently borrowed $35 million from a hedge fund
While talks continue about selling the plant, GM itself has shut the door on placing a new vehicle back in the plant—something that will surely stir up the UAW as we approach labor negotiations. The UAW has said it does not want GM to sell the plant, but instead, allocate a new vehicle for production.