General Motors announced sweeping restructuring moves on Monday, including plant closures and white-collar employee layoffs, as it continues to revamp its operations to meet shifting consumer demand.
The automaker said it would halt production next year at four plants in the U.S. and one in Canada, resulting in the layoff of about 6,300 production workers who currently make such Chevrolet models as the Cruze compact, the Volt, and the Impala.
In addition, about 15% of GM’s salaried workforce, or 8,000 workers, will lose their jobs as GM positions itself for what it called “the demands of the marketplace” and a future of electric and autonomous vehicles.
“What we’re doing is transforming this company,” CEO Mary Barra told reporters. “This industry is changing very rapidly when you look at propulsion, autonomous driving, and ride sharing. We want to be in front of it while the company is strong and the economy is strong.”
The plant closures in Michigan, Ohio, Maryland, and Ontario, Canada, are GM’s first since 2010. They reflect the shift of consumers away from sedans and toward bigger, roomier vehicles like pickup trucks and SUVs.
GM “is reinvesting money away from cars that once dominated America’s roadways and putting it into technology it believes will power its future,” CNN noted.
The company is also competing with rival automakers including Ford to mass-produce the cars of the future, allocating $1 billion to its Cruise unit this year. The restructuring will “make sure that GM is lean and ready to lead in the world in the cars our customers want and” the future of mobility, Barra said.
Jon Gabrielsen, an independent adviser to the auto industry, praised GM for its forward thinking. “For the first time in my memory, GM is leading the pack on tangible restructuring actions, and the dominoes are really starting to fall,” he told The New York Times.
But the United Auto Workers slammed the company for its “callous decision … to reduce or cease operations in American plants, while opening or increasing production in Mexico and China plants for sales to American consumers.”
Photo: John F. Martin for General Motors