COLUMBUS, Ohio — Two Mahoning Valley lawmakers are trying to help Lordstown Motors, the electric vehicle startup, bypass Ohio’s dealership rules and sell its electric pickup trucks directly to its customers.
Company officials said selling direct to customers will allow them to be more efficient as they try to begin large-scale production later this year. The company, manufacturing on the site of the former General Motors assembly plant near Youngstown, has hired 500 workers, and hopes to begin filling orders this fall.
During a Statehouse news conference with company officials Wednesday, State Rep. Mike Loychik and state Sen. Michael Rulli said they plan to introduce their bill in the next week or two. They’re trying to re-brand their manufacturing heavy region, which has been declining economically since the 1970s, as “Voltage Valley.”
“What’s good for Lordstown Motors is good for Ohio,” said Rulli, a Republican from Salem in Columbiana County. Loychik, a Republican, is from Warren.
The attempt to create a carve-out for Lordstown Motors will set up a fight with the Ohio Auto Dealers Association, which unsuccessfully tried to block Tesla, the electric-vehicle manufacturer, from doing the same thing last decade. Settling a lawsuit from the dealers association, Ohio lawmakers in 2014 granted Tesla permission to operate three stores in Ohio, while specifying the carve-out applied to no other companies.
Zach Doran, executive director of the auto dealers association, said auto manufacturers with a major presence in Ohio, including Honda, Ford and Chrysler, are all pursuing electric vehicles while working within the dealership system.
“Lordstown Motors, after deciding to build in Ohio and receiving state tax credits to do so, now seeks an exemption to the law governing the sale of new vehicles,” Doran said. “Lordstown Motors is a welcome development in Ohio’s rich history of automotive research, innovation and production. Like other manufacturers, the new company will enjoy great success operating within the scope of Ohio’s current law.”
Auto dealers say they create competition that drives sales prices down while offering customers an easy opportunity to service their vehicles. Dealerships make much of their money from maintaining and repairing the cars that they sell.
But Lordstown officials say they have a different business model that aims to sell fleets of their trucks not to individuals, but as fleets to commercial customers, including governments and large companies. The company’s plan is to train their customers’ technicians to service the trucks, which they say should break less frequently than traditional vehicles with internal combustion engines because they have fewer parts.
Lordstown has said it has 100,000 pre-orders for fleet vehicles, and doesn’t plan to try to sell to individual customers for at least two years while they try to work through their order list. The company is trying to be the first to offer a fully-electric pickup truck, trying to beat Tesla and most major traditional car manufacturers to the market. Setting up a network of third-party sellers would be more expensive and take longer, company officials said.
“We need the flexibility and the ability to sell directly to our consumers,” Chris Kerzich, Lordstown Motors’ top in-house lobbyist, said Wednesday.
Lordstown Motors was founded in November 2019, after buying the shuttered General Motors assembly plant in Lordstown, in Trumbull County. Workhorse Group, a Cincinnati electric-vehicle firm, owns a minority stake in the company and one of its founders, Steve Burns, is now Lordstown Motors’ CEO.
The fledgling company has enjoyed an unusually high political profile, given media attention paid to the Mahoning Valley’s role in helping elect Donald Trump as president, and the resulting political interest the former president took in fate of the area. The company showed off its Endurance pickup truck prototype at a White House event last September, the night before Cleveland hosted the first presidential debate.
Thousands of former GM workers lost their jobs when the plant closed.
In June 2019, the same month his 22-year-old grandson was hired at the company for what quickly turned into a full-time lobbying job, Gov. Mike DeWine touted Lordstown Motors as the future of the industry.
Lordstown Motors became a publicly traded company in October, capitalizing on recently increased investor interest in electric-vehicle companies. In December, the company was approved for state tax credits worth an estimated $20 million in exchange for a promise to hire 1,570 full-time workers and generate $91 million in new annual payroll by the end of 2025.
Mahoning Valley lawmakers have taken other steps to try to encourage the manufacturing of batteries and electric vehicles in the region. Rulli introduced a bill last month that if passed, would offer state grants to help cover the costs of installing electric-vehicle charging stations.