News of General Motors proposed restructuring is still reverberating throughout the automotive industry. GM CEO Mary Barra will meet with Michigan and Ohio lawmakers later this week to discuss the proposed plan. After GM announced a $6 billion restructuring plan last week that would call for layoffs, model discontinuations, and plant closures, politicians across the political spectrum are crying foul. While much of what GM wants to do has to be hammered out with the United Auto Workers union, the company has started laying off some white-collar contract workers, according to Automotive News.
The first round of layoffs is “very isolated,” according to GM spokesperson Pat Morrissey, who spoke with the Detroit publication about the matter, though it’s likely that it’s being downplayed. Those affected worked in the company’s global product group/engineer departments in Pontiac, Michigan. This is part of the company’s plan to reduce its North American salaried contract and salaried workforce by 15 percent. GM did not specify how many people it laid off in Pontiac.
In total, GM wants to reduce its salaried workforce by about 8,100 employees. The company employs 54,000 North American salaried workers. The layoffs include a 25 percent reduction in its executive staff, too. Earlier this year, GM offered voluntary buyouts to 18,000 salaried employees with 12 years of experience or more; however, the not enough took the buyouts, which will force the company the lay off workers in the coming days, weeks and months.
The goal of the restructuring is to reposition the automaker for the future, focusing resources on electric vehicles, self-driving vehicle technologies, and high-selling crossovers and SUVs. The company wants to pull resources and capital away from slow-selling sedans—it wants to discontinue six such models. GM wants to close five North American production facilities, too. For GM, the upcoming year will be crucial. The company will have to negotiate with the UAW union for much of what it wants to do, and neither side will want to compromise much.