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KJP

Brook Park / Walton Hills: Ford Plant Redevelopments

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On 5/26/2019 at 9:09 PM, Klingaling87 said:

So, for those that have a subscription, there’s an article in today’s Crains that discusses Ford’s vacant properties in Brookpark (or is that Cleveland?) and Walton Hills. The gist of the story is that there’s a potential buyer for BOTH properties, and it would be a “game changer” for the region’s economy. The product profile or potential company isn’t identified, but wondering if anyone has any insight? Very curious as to who the user is and what it could be. 

 

https://www.crainscleveland.com/real-estate/ford-driving-sale-huge-northeast-ohio-sites

 

1 hour ago, Dougal said:

Specific interest in the Ford foundry has my attention.  Conventional wisdom says that an Ohio foundry can't produce dumb items like engine blocks at a competitive price because the labor component of cost is too high relative to the blocks' value. Ohio foundries have to be unique (like Arconic's in Cleveland), or non-union like the smaller ones, or produce high-value, sophisticated items to survive. This thinking would seem to rule out somebody like a foreign auto company being the buyer.

 

I'm asking around to real estate sources, but so far no one knows who the buyer is. One thing I did learn is that there was a lot of interest in the two properties, mostly by out-of-state suitors. I'm told there were more than a dozen offers for either or both Ford properties.

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I wonder what they mean by "game changer".  I don't think just getting the plants up and running again making conventional cars or trucks would be "game-changing", per se.  Great for the local economy, sure, but not really game changing.

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Previously there was a group looking at these plants for the game-changing new type of spark plugs to be manufactured there.  They used that phrase. It was movers and shakers of Northeast Ohio that were advisors to get the manufacturing going. That fell through a couple years ago and that group was disbanded.  There still exists plasma igniter group that oversees the research and they have not made any big moves publicly.   My understanding is they are manufactured in small batches in LA with the bulk of their product going to the military.  

  It could be this company polishing off the previous plan since they were the ones originally in talks with Ford for those plants. Or it could be some other group we don’t know about. 

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Ford-Logo-on-Dearborn-HQ-FordAuthoritydo

 

FRIDAY, MAY 31, 2019

Cleveland-area Ford plants redo to spark local economy

 

Redeveloping one auto plant measuring nearly 2-million-square-foot for a single manufacturer is a pretty big deal. The redevelopment of two of them for a single manufacturer is a bigger deal. The use of them for producing game-changing automotive technologies is about as big as it gets.

At least one of the game changing technologies is the plasma ignition system, also known as the sparkless ignition, according to a party involved with sales transaction.

 

MORE:

https://neo-trans.blogspot.com/2019/05/cleveland-area-ford-plants-redo-to.html

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Thanks for another informative article, KJP.  One thing though: your statement that the automotive industry doesn't have any strategies for electric cars, reducing emissions and driverless cars seriously undersells what they're doing.  The auto OEMs are investing billions in these technologies.  Most are planning several new electric models over the next few years and most have pretty serious AV units.  I'm not saying they've got it all figured out and that everything they're trying is going to work, but I certainly wouldn't portray Tesla as the only one with their act together (and whether they really do is questionable too)

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Nothing


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On 9/9/2019 at 3:28 PM, B767PILOT said:

Any update on this?

 

Is Rivian Automotive the Ford plant savior?

 

Rivian Automotive, a Detroit-based start-up which wants to produce electric pickups, has impressive backers  ($1.2 billion from Ford and Amazon)  and just got a fresh billion from Cox Enterprises (same family as the cable guys). The fresh billion is probably intended to get them off the drawing board and into production.  Just a thought ...

 

Edit: A counter thought is Rivian owns a defunct Chrysler plant in Normal, Il, which they bought 3 years ago.

 

https://www.wsj.com/articles/electric-truck-maker-rivian-gets-new-cash-from-cox-enterprises-11568122201?mod=searchresults&page=1&pos=1

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Is $2.2 billion the going price for reactivating one auto factory (I thought the Normal, IL plant was Mitsubishi's?) and perhaps a supply chain? I have no idea what it might cost. Perhaps there might be some $$ left over for reactivating two plants in Northeast Ohio? Lots of amazing, percolating economic news for this area.

 

The timing of this announcement might be made right around the same time as SHW making its HQ+R&D announcement. And then there's some other stuff floating around out there....

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1 hour ago, KJP said:

Is $2.2 billion the going price for reactivating one auto factory (I thought the Normal, IL plant was Mitsubishi's?) and perhaps a supply chain? I have no idea what it might cost. Perhaps there might be some $$ left over for reactivating two plants in Northeast Ohio? Lots of amazing, percolating economic news for this area.

 

The timing of this announcement might be made right around the same time as SHW making its HQ+R&D announcement. And then there's some other stuff floating around out there....

 

I believe the plant began as Chrysler, became joint with Mitsubishi, and ended up just Chrysler in bankruptcy.

 

Amazon just ordered 100,000 trucks from Rivian.  They need some production now, now , now; and that Illinois plant never built engines. 🙂

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I've been doing some reading on the subject. @Dougal, I think you've discovered it.

 

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Here's some info on the Normal plant. My history was a bit off. 

 

https://www.rivianforums.com/threads/rivian-factory-plant-in-normal-il-and-headquarters-in-plymouth-mi.69/

 

It sounds as if Rivian is invested, but not too deeply, in Normal. They bought the factory before they had a product and apparently didn't get any grant aid that would commit them to a course of action - just a promise of future tax credits from state and local government dependent on performance. If the product ends up being largely plastic panels (to save weight), they don't need 5 million sq ft of stamping capacity in Normal. And they probably bought the place for a song.  If Ford Brookpark and Walton Hills better suit their product, I could see them changing their plans.

 

Admittedly, I'm grasping at straws a bit, here.  😉

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Me too.....

 

Rivian-factory-NormalIL2.jpg

 

MONDAY, SEPTEMBER 23, 2019

Future of two idled Cleveland-area Ford plants looks electric

 

Since spring, Greater Clevelanders have been hearing that the sale and reactivation of two massive, idled auto plants in the area to a single buyer will be a "game-changer" for the economy of this region. There were more than 15 potential buyers with many showing interest reusing both factories in a positive way.

Ford has since short-listed the potential buyers and will soon select a winner. I took a stab last May at who one of those buyers might be. While I'm pretty sure I missed then (Tenneco's finances have fallen sharply in the past year), I feel much more comfortable in my aim in this article.

 

MORE:

https://neo-trans.blogspot.com/2019/09/future-of-two-idled-cleveland-area-ford.html

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Granted, the success of the auto industry can be a very cyclical thing, I feel like there is so much untapped potential for EV.

 

For the regional economy, the impact of 2,000 - 3,000 NEW jobs would be AT LEAST comparable to the impact of a new SW HQ on Public Square! 

 

Awesome news.  Thanks for putting this together!

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1 hour ago, KJP said:

Me too.....

 

Rivian-factory-NormalIL2.jpg

 

MONDAY, SEPTEMBER 23, 2019

Future of two idled Cleveland-area Ford plants looks electric

 

Since spring, Greater Clevelanders have been hearing that the sale and reactivation of two massive, idled auto plants in the area to a single buyer will be a "game-changer" for the economy of this region. There were more than 15 potential buyers with many showing interest reusing both factories in a positive way.

Ford has since short-listed the potential buyers and will soon select a winner. I took a stab last May at who one of those buyers might be. While I'm pretty sure I missed then (Tenneco's finances have fallen sharply in the past year), I feel much more comfortable in my aim in this article.

 

MORE:

https://neo-trans.blogspot.com/2019/09/future-of-two-idled-cleveland-area-ford.html

 

 

Very nicely written, KJP; I think we have a winner with the Rivian pick. I wonder what percentage of ownership Ford's stake represents.  Their 10-K will probably say in another 6 months or so.

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Thanks, but you gave me the idea. I didn't read anything that convinced me it wasn't the pick, quite the contrary. But I would've liked to have found some rumors on the Rivian public forums suggesting they were still searching for additional factory capacity. Then again, the Amazon delivery truck order news hit only last week. I'm sure that $10 billion order has been in the works for some time, so Rivian may have been looking for additional factory capacity for some time.

Edited by KJP
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^What about an assembly plant?  If their production is that large, maybe they can all be sending parts a bit further east to a plant that has been idled and supposedly up for sale. 

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Do you mean Walton Hills? If so, my presumption (and article) says both could be acquired by Rivian.


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5 hours ago, audidave said:

I’m referring to Lordstown as that is an assembly plant. Walton hills is a stamping plant

 

This piqued my curiosity as to whether the GM Lordstown plant was also along the Norfolk Southern Mainline vs CSX - looks like it's adjacent to both.

 

This article indicates that plant's leading suitor is still Workhorse, an Ohio-based EV startup that is a competitor to Rivian, which originally was in the news on May 8th due to their interest in the shuttered facilities...

 

With some Workhorse funding tied to a proposed 10% joint venture stake from GM, that seems to parallel @KJP's article's point that Ford has a continued revenue stream from operations of its plants should they be acquired by Rivian...

 

...so I do question how Rivian may pull the deal from under Workhorse if GM is poised to have a financial interest in Workhorse as the answer to Ford's hedge in Rivian.

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Lordstown can be served by Norfolk Southern but from its Lordstown secondary track between Alliance and Niles which has been out of service for more than a decade. Thankfully. NS is doing basic maintenance to keep it mothballed.

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17 hours ago, Dougal said:

 

 

Very nicely written, KJP; I think we have a winner with the Rivian pick. I wonder what percentage of ownership Ford's stake represents.  Their 10-K will probably say in another 6 months or so.

 

Per this article from Reuters, Ford owns about 10% or a little less of Rivian.  Rivian's not public so knowing their valuation can be tricky unless they publicly announce it and even then it only represents a point in time.

 

https://www.reuters.com/article/us-rivian-ford-motor-idUSKCN1S01LD

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5 hours ago, Potamus said:

 

Per this article from Reuters, Ford owns about 10% or a little less of Rivian.  Rivian's not public so knowing their valuation can be tricky unless they publicly announce it and even then it only represents a point in time.

 

https://www.reuters.com/article/us-rivian-ford-motor-idUSKCN1S01LD

 

If in fact Rivian takes the two Cleveland plants from Ford, I'd bet the payment will be some form of equity.

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Although no buyer has been identified, Ford provided Ohio EPA with Voluntary Action Plan environnental data to review for its Walton Hills plant earlier this year. Ford said it wanted to get the project done soon because they had a buyer that was on a timeline. 

 

Ford also recently told Ohio EPA that Brook Park Engine Plant #2 would be going through the VAP too and it would start sending documents to Ohio EPA for review by the end of this year or the beginning of next. Source says that if VAP projects are suddenly moving on these sites, something is definitely afoot.  

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On 9/23/2019 at 2:04 PM, audidave said:

^What about an assembly plant?  If their production is that large, maybe they can all be sending parts a bit further east to a plant that has been idled and supposedly up for sale. 

 

On 9/23/2019 at 2:09 PM, audidave said:

I’m referring to Lordstown as that is an assembly plant. Walton hills is a stamping plant

Sounds like Lordstown is likely not part of Rivian's plans.

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4 hours ago, infrafreak said:

 

Sounds like Lordstown is likely not part of Rivian's plans.

Unless they supply batteries for them

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The thing is, Chrysler Twinsburg and Ford Walton Hills weren't shut down because of the recession, at least not primarily.   The strong trend is to stamp parts where they are going to be assembled, because it's way easier to ship blanks than body stampings.

 

So....they could end up assembling in Walton Hills.   They likely aren't going to need all that parking the plant has, and there is further room to expand going north.

 

Edit:  oops, sorry if this is confusing.   If they are going to stamp body parts at Walton Hills, they may even do some assembly there.

Edited by E Rocc
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Rivian+Plymouth+Office+Headquarter2.jpg

 

WEDNESDAY, NOVEMBER 6, 2019

Rivian looking more likely to buy & use Cleveland-area Ford plants

 

Several thousand new, well-paying jobs appear to be bound for Greater Cleveland which could become a hotbed of Electric Vehicle (EV) production for many years to come. That's based on recent news and tips from a couple of insider sources.

In a NEOtrans article posted Sept. 23, I speculated that EV startup Rivian may be the likely buyer of two Cleveland-area plants mothballed by Ford Motor Co. One is the 1.7-million-square-foot Brook Park Engine Plant No. 2 that closed in 2000 and the other is the 2.1-million-square-foot Walton Hills Stamping Plant that closed in 2015.

That speculation could be a realistic outcome considering several recent developments.

 

MORE:

https://neo-trans.blogspot.com/2019/11/rivian-looking-more-likely-to-buy-use.html

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^ As wonderful as all the SHW news is, if this plays out as hoped and the two plants get back into large-scale manufacturing, this is a far bigger boost for the region’s profile and confidence. 

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hopefully some of this good news can also spill over to the mostly mothballed lorain ford plant.

 

i will ask my bro and relatives about all this.

 

i know they are more into new contract issues at the moment.

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Quote

 

GM selling shuttered Lordstown factory to electric truck maker

Updated Nov 07, 2019;Posted Nov 07, 2019

5-6 minutes

TOLEDO, Ohio (AP) — General Motors is selling a massive assembly plant it shut down earlier this year in Ohio, a closing that drew threats and scolding from President Donald Trump, to a newly formed company that said Thursday it intends to begin making electric trucks by late 2020.

 

 

Lordstown GM Plant Sales

 

So is NEO on the cusp of being one of the major centers for US production of electric vehicles, or what?

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Wow this is pretty cool..  If all three of the major plants get turned back on Northeast Ohio is going to have tons of jobs!

 

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On 11/6/2019 at 1:45 PM, roman totale XVII said:

^ As wonderful as all the SHW news is, if this plays out as hoped and the two plants get back into large-scale manufacturing, this is a far bigger boost for the region’s profile and confidence. 

Yeah, totally agree here; as awesome and exciting as the SW news is, these Ford plants coming back to life will ultimately have a far greater impact on our local & regional economy as the spin-off, supplier, contracting, trucking jobs etc are created. 

Huge win for the area if true!

*great job @KJP on this, per usual👌

Edited by CleCaneFan
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I also think its important to note that electric vehicles are clearly where the industry is headed over the next 20+ years.  In my head, that means good potential for future job growth / stability.  Really exciting stuff!  Do we know if Rivian is a UAW employer or what the payroll might look like?  I assume, it would be similar to other automakers.

Edited by West153

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I've read that Rivian and the UAW have not made that decision yet, but they have had talks and those talks were described as friendly.

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