Author: Jack
POSTED ON 28 Nov 2018

GM To Cut Thousands of Jobs and Close Factories

Well that escalated rather quickly. Just the other day, GM announced that they would be slashing thousands of jobs and closing five factories across North America – including the factory in Lordstown, Ohio where the factory has been in operation for over 100 years. The goal is to streamline operations to prepare GM for the future of autonomous vehicles, EV/ PHEV, and the growing SUV market segment.

“Zero Crashes, Zero Emissions, Zero Congestion” is GM newest motto.

It’s a viscous cycle, but when company restructuring is necessary to better position themselves for their overall future, big changes usually requires a lot of sacrifices. President Trump is pissed !

One of Trump’s campaign promises was to bring life back into the “dying” automotive sector, and make it easier for American automotive companies to do business overseas. GM cutting 15% of its salaried workforce and closing four out of the five factories in the United States (apparently it’s OK to close the factory in Oshawa, Ontario since it’s not “American”)  goes strictly against his promises. Thus Trump has threaten to cut all of GM subsidies, including electric cars via his favorite communication medium which caused GM stocks to tumble 3.8%.

The issue with all of this is GM is simply trying to follow the market trend and prepare for the future demands. Americans are shifting away from sedans in favor of trucks and SUVs – so why continue to build them? The growing demand of electric vehicles, ride sharing, and autonomous vehicles also requires a serious look at their currently lineup. Does it really make sense to continue building cars that doesn’t match the future market trend?

Of course not. GM is a business after all. This isn’t even taking into account Trump’s tariffs which has created problems for the automotive industry by causing commodity items such as steel and aluminum prices to increase.

We can only hope that after the restructuring dust has settled, GM will be able to either shift salaried employees to other departments, or rehire many that had to be let go.