General Motors to lay off 15 per cent of salaried workers, halt production at five plants in US, Canada
- Move is part of a sweeping realignment as car maker turns toward electric vehicles
- US President Donald Trump says company should stop making cars in China
General Motors Co said on Monday it would cut production of slow-selling models and slash its North American workforce in the face of a stagnant market for traditional gas-powered sedans, shifting more investment to electric and autonomous vehicles.
The announcement is the biggest restructuring in North America for the No. 1 car maker in the US since its bankruptcy a decade ago. Its shares rallied 7.6 per cent to $38.66 in late morning trading.
GM plans to halt production next year at three assembly plants – Lordstown, Ohio; Hamtramck, Michigan; and Oshawa, Ontario. The company also plans to stop building several models now assembled at those plants, including the Chevrolet Cruze, the Cadillac CT6 and the Buick LaCrosse. The Cruze compact car will be discontinued in the US market in 2019.
Plants in Baltimore, Maryland, and Warren, Michigan, that assemble power train components will have no products assigned to them after 2019 and thus are at risk of closure, the company said. It will also close two factories outside North America, but did not identify them.
“We are right-sizing capacity for the realities of the marketplace,” Chief Executive Mary Barra said, adding that the cuts were prompted by auto industry changes. Barra said the company would double resources dedicated to electric and self-driving vehicles over the next two years.
The United Auto Workers union vowed to “confront this decision by GM through every legal, contractual and collective bargaining avenue open to our membership.”