GM in talks to sell closed Lordstown factory to electric-vehicle maker Workhorse

AUTO INDUSTRY

GM in talks to sell Ohio plant to Workhorse

President Trump tweeted Wednesday and General Motors confirmed that the automaker is trying to sell its recently closed Lordstown, Ohio, factory to Workhorse Group, an electric-vehicle company with fewer than 100 employees.

GM said it is “in discussions” with Workhorse. Representatives of both companies expressed optimism that they could complete a deal, although they stressed that talks were in early stages and that any agreement would have to be approved by the United Automobile Workers union.

The companies were more guarded than Trump, who said in a tweet earlier Wednesday: “GREAT NEWS FOR OHIO! Just spoke to Mary Barra, CEO of General Motors, who informed me that, subject to a UAW agreement etc., GM will be selling their beautiful Lordstown Plant to Workhorse, where they plan to build Electric Trucks. GM will also be spending $700,000,000 in Ohio…”

But the UAW indicated that it would continue to push for GM to build one of its own vehicles in Lordstown.

“The UAW’s position is unequivocal: General Motors should assign a product to the Lordstown facility and continue operating it,” UAW Vice President Terry Dittes said in a statement.

Trump lashed out at GM repeatedly after the carmaker began laying off 4,500 employees at the Lordstown plant, which made the Chevy Cruze sedan, urging the company to reopen the facility or sell it to another company. The last GM Lordstown factory workers were cut in March.

— Heather Long

INTERNET

U.S. charges 2 with money laundering

U.S. prosecutors have filed money laundering charges against two Israelis who allegedly made millions of dollars operating a website connecting buyers to sellers of fentanyl, heroin, guns and other illegal goods, the Justice Department said Wednesday.

The department said Tal Prihar, an Israeli living in Brazil, and Michael Phan, an Israeli living in Israel, owned and operated a website known as “DeepDotWeb,” or DDW.

Robert Johnson, an assistant director of the FBI, said DDW operated for years as a “key gateway to the criminal underbelly” of the dark Web, or Darknet, economy.

— Reuters

INVESTMENTS

Berkshire takes
tax hit in alleged fraud

Berkshire Hathaway thinks it was duped.

Warren Buffett’s company took a $377 million charge after investing hundreds of millions in tax-equity investment funds tied to a company that federal authorities say engaged in fraud, according to Berkshire’s first-quarter regulatory filing. The investments were tied to DC Solar, Debbie Bosanek, Buffett’s assistant, said Wednesday in response to Bloomberg’s questions about the expense. That’s the mobile solar generator company that federal authorities have alleged ran a fraudulent scheme involving tax benefits.

“In December 2018 and during the first quarter of 2019, we learned of allegations by federal authorities of fraudulent income conduct by the sponsor of these funds,” Berkshire said Saturday in the filing, without naming the sponsor. “As a result of our investigation into these allegations, we now believe that it is more likely than not that the income tax benefits that we recognized are not valid.”

Companies including Progressive and East West Bancorp also say they’ve been hurt by tax-related investments involving DC Solar, which allegedly promoted its ability to provide “very favorable tax consequences.”

— Bloomberg News

Also in Business

U.S. manufacturers remain upbeat about sales this year, though less so than before as a majority say hiring remains difficult and tariffs have raised prices. Fifty-five percent of producers expect higher 2019 revenue, down from 64 percent in December, an Institute for Supply Management survey showed Wednesday. Service providers were less optimistic, with the share forecasting sales gains falling to 47 percent from 57 percent, according to the poll of purchasing and supply executives who participate in ISM’s monthly surveys.

— From news reports

COMING THURSDAY

8:30 a.m.: Commerce Department releases international trade data for March.

8:30 a.m.: Labor Department releases the Producer Price Index for April.

10 a.m.: Commerce Department releases wholesale trade inventories for March.

10 a.m.: Freddie Mac releases weekly mortgage rates.