Tuesday, November 27, 2018

RIP:  GM Will Close 5 Assembly Plants in North America, Eliminate 15,000 Jobs, & Cease Production of Chevy Volt

Chevrolet boltev (Credit: Road & Track) Click to Enlarge.
The mournful cry from Detroit that “Nobody wants to buy an electric car” is partially correct.  Relatively few consumers want to buy a passenger car, period.  As the market moves strongly toward SUVs, crossovers, and light trucks, General Motors is finding it needs to cut way back on passenger car manufacturing in North America.  Today, November 26, GM announced it will cease production at 5 North American assembly plants — three of them build cars, and the other two make driveline components for passenger cars.

The plan will mean the loss of 14,700 manufacturing jobs — 6,000 in Canada and 8,700 in the US — together with a 15% reduction in its 54,000 person white collar workforce.  GM started asking some 18,000 employees to consider an early retirement offer in October as the company struggled to adjust to new market realities, according to The Guardian.

According to a GM press release, the factories scheduled to be closed are:
  • Oshawa Assembly in Oshawa, Ontario, Canada.
  • Detroit-Hamtramck Assembly in Detroit, Michigan.
  • Lordstown Assembly in Warren, Ohio.
The powertrain facilities affected are
  • Baltimore Operations in White Marsh, Maryland.
  • Warren Transmission Operations in Warren, Michigan.
The company has also confirmed to Inside EVs that production of the Chevy Volt will end March 1, 2019.  Is that the end of The General’s foray into building electric cars?  No.  The press release goes on to say, “GM has recently invested in newer, highly efficient vehicle architectures, especially in trucks, crossovers and SUVs.  GM now intends to prioritize future vehicle investments in its next-generation battery-electric architectures.  As the current vehicle portfolio is optimized, it is expected that more than 75 percent of GM’s global sales volume will come from five vehicle architectures by early next decade.”
Can GM Survive?
GM has been experiencing declining sales in China and the US of late as customers have been finding the offerings from other companies more to their liking.  It ran away from the European market last year, preferring to sell its operations there for the best obtainable price rather than deal with tightening EU emissions standards.  It seems to have more interest in operating a fleet of autonomous vehicles in world cities than actually selling automobiles any more.

Is GM in a downward spiral?  It’s too early to tell, but it seems mildly shell shocked by the tectonic shifts in the market that have taken place over the past few years.  It went bankrupt in 2008 and got bailed out by the taxpayers.  There will likely be little appetite for doing that again any time soon.

All three legacy US automakers — GM, Ford, and Chrysler — will be severely tested in coming years as they face increasing competition not only from Tesla but Chinese manufacturers as well.  There is every reason to believe only one of the so-called Big Three will still be around a decade from now.

Read more at RIP:  GM Will Close 5 Assembly Plants in North America, Eliminate 15,000 Jobs, & Cease Production of Chevy Volt

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