On Monday General Motors announced they would be “transforming the global enterprise to advance the company’s vision of Zero Crashes, Zero Emissions, Zero Congestion.”
That transformation, the company said in their statement begins by “reorganization of its global product development staffs, the realignment of its manufacturing capacity and a reduction of salaried workforce.” The plan is expected to “increase annual adjusted automotive free cash flow by $6 billion,” by the end of 2020.
GM Chairman and CEO Mary Berra explains that the actions taken by GM will continue “our transformation to highly agile, resilient and profitable, while giving us the flexibility to invest in the future.” Berra added, “we recognize the need to stay in front of changing market conditions and customer preferences to position our company for long-term success.”
The goal according to GM is to improve quality and speed to the market, by allocating resources to “electric and autonomous vehicle programs.”
In the statement GM also announced the closure of three assembly plants, and two propulsion planets:
- Oshawa Assembly in Oshawa, Ontario, Canada.
- Detroit-Hamtramck Assembly in Detroit.
- Lordstown Assembly in Warren, Ohio.
- Baltimore Operations in White Marsh, Maryland.
- Warren Transmission Operations in Warren, Michigan.
Along with the five planned closures in the U.S., the company will cease operations of two plants outside North America by 2019, that is in addition to the previously announced closure of an assembly plant in Gunsan, Korea.
Sunday The Wall Street Journal reported that according to Canada’s CTV television network the plant closure in Oshawa, Canada, “will affect roughly 2, 800 workers.” At the time GM did not comment on the closures, but according to John Henry Oshawa’s mayor, “You’d be hard pressed to find somebody in Oshawa that doesn’t have a tie to General Motors.”
Mayor Henry took to Twitter late Sunday to ask for calm as employees awaited the announcement from GM on Monday.
Canada’s Prime Minister Justin Trudeau offered a short statement on Twitter after GM’s statement was released.
The New York Times reported Monday that the four U.S. plants that are due to close next year will result “in the layoff of 3,300 production workers,” and added that the salaried staff layoffs is about 8,000 people.
Reuters reports that while Barra “did not link the cuts on Monday to tariff pressures,” she did say that, “trade costs are among the “headwinds” GM has to face as it deals with broader technology change and market staff.”
The article explains that GM has said tariffs “on imported steel,” have cost the company $1 billion.
At the time of writing this post President Trump has offered no comment. Senator Sherrod Brown (D-OH) has issued several tweets on the closure of the plant in Ohio, stating he feels GM owes the community answers.
GM owes the community answers on how the rest of the supply chain will be impacted & what consequences its disastrous decision will have on the Valley & Ohio. My office stands ready to do everything we can to help these workers. This decision is corporate greed at its worst. -SB— Sherrod Brown (@SenSherrodBrown) November 26, 2018
Rep Tim Ryan (D-OH) called the move a “bad combination of greedy corporations,” via The Hill.