DETROIT Elio Motors has agreed to purchase a former General Motors Co (GM.N) assembly plant near Shreveport, Louisiana and will use it to build three-wheeled vehicles that it says will get more than 80 miles on a gallon of gasoline, the company said on Thursday.
Terms of the sale were not disclosed in a joint press release from Elio and Racer Trust, which owns properties GM disposed of in its bankruptcy. The deal is expected to close in the spring.
Elio said it expects to begin commercial vehicle production in mid-2014 with "significant hiring" at the plant to begin by the second quarter of that year and full employment of 1,500 people reached in late 2015. Louisiana state officials said in a separate release that Elio will begin renovating the plant early this year.
Elio said its car will achieve a highway mileage rating of more 80 miles per gallon. Louisiana officials said Elio is targeting a retail price of $6,800 for the car, which will be equipped with three airbags, power windows and air conditioning.
The Elio jobs will pay an average annual salary of $47,700, plus benefits, and the company will make a capital investment of $100 million, Louisiana officials said.
The Shreveport plant will be the 25th former GM property sold since the Racer Trust was established in March 2011, raising more than $27 million. The trust was charged with selling the 89 locations in 14 states that GM left behind following its 2009 bankruptcy and $50 billion taxpayer bailout.
Production at the former GM plant ceased in August 2012. GM had continued work at the plant under a lease with Racer Trust, officially known as the Revitalizing Auto Communities Environmental Response Trust.
Elio, founded in 2008, will build its three-wheeled vehicles in the 1.8 million-square-foot factory that was built in 1981 and most recently expanded in 2002. The property also includes a paint shop, powerhouse and wastewater treatment facility, rail spur and 530 acres of land.
Elio said it expects to use about 1 million of the more than 3 million square feet available for its manufacturing operations.
Industrial developer Stuart Lichter, who has acquired other former GM sites, will buy the 530-acre Shreveport site in conjunction with Elio and lease portions to other tenants, state officials said. Lichter is president of Los Angeles-based Industrial Realty Group.
Elio will receive an incentive package from Louisiana Economic Development, Louisiana officials said. The Caddo Parish Commission also is negotiating potential incentives.
(Reporting By Ben Klayman in Detroit; Editing by David Gregorio)