In order to support a transition to all-electric powertrains across its light duty vehicle lineup by 2035, GM is enacting a slew of new cost-cutting measures, including a round of job cuts. Now, according to a new report, GM terminated “hundreds” of contract employees over the weekend, effective immediately. The terminations are part of an effort to reduce costs by $2 billion over the course of the next two years.
According to a report from Detroit Free Press, the contract terminations were put in place at GM’s Global Technical Center in Warren, Michigan, as well as several other GM locations. Although GM did not specify exactly how many terminations were made, a GM spokesperson did confirm that “several hundred” contract workers were terminated as of Saturday, most of which were full-time. The cuts are expected to be permanent.
“They’re in the global product development area in all different areas. It can be multiple different positions,” GM spokesperson Maria Raynal told Detroit Free Press. “It’s part of normal operations and it contributes to that saving, but we’re not sharing a specific number.”
Contract workers are considered separate from GM employees, and are ineligible to receive company benefits.
The terminations follow the GM’s voluntary separation program (VSP) announced in March, wherein certain GM employees were offered pay, health coverage, and other benefits for a limited time in exchange for voluntarily leaving the company. The VSP was available to all U.S. salaried employees with at least five years of service, as well as global executives with at least two years of service. Reports indicate that 5,000 white collar workers opted to participate in the program, and as a result, the automaker would not need to resort to employee job cuts going forward. Employees participating in the VSP are expected to leave the company by the end of June.
According to GM CFO Paul Jacobson, roughly 30 to 50 percent of the savings realized in the cost-cutting program are expected during the 2023 calendar year.
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Comments
GM is all-in and doubling down on its bet on all EV’s. Good luck with that, I’m out. I’ll buy a new ICE vehicle before the date and then ICE HD trucks after that. Hopefully I’ll be in the business of re-gearing the ICE HD trucks for fuel economy and rebuilding the ICE 1500’s for those who want to stay with ICE.
“Hopefully I’ll be in the business of re-gearing the ICE HD trucks for fuel economy and rebuilding the ICE 1500’s for those who want to stay with ICE.”
I thought of the ongoing demand for affordable ICE vehicles too and you’re right on Boomer. A serious ICE light truck remanufacturing business would be a no-brainer success if the Feds don’t ban it.
Even today, with the exorbitant price of new trucks propping up OEM profits and subsidizing huge EV development costs it would be a winner assuming the supply chain could be worked out.
GM like all other manufacturers have gotten “fat” off the impulsive buyers during Covid with the ridiculous price hikes!! Now, people can’t afford the insane price of vehicles, along with the interest rates, no trucks and suvs are selling. So instead of offering incentives/rebates. They shut down plant production, hurting their workers! Way to go Mary!! Stop the nonsense and build an affordable truck/suv that the average american doesn’t have to take out a 7-10 year loan out on it!!
These car companies are in big trouble and know it. With all the talks of a looming recession doom and gloom, interest rate hikes, sky high inflation and the never ending push by the left to go green they are seeing much trouble ahead. Add to that softer sales on high profit ICE vehicles like the Silverado/Sierra and knee jerk reactions like what we are seeing here will be common place in the upcoming years ahead
I just read an article about the Norwegian Ferries ban all EV, hybrid and hydrogen vehicles from being on their Ferries. Direct result from the sinking of the Felicity Ace sinking off the coast of the Azores, Portugal last Feb. E-vehicles caught fire and couldn’t be extinguished. Another reason in my opinion why the big green deal is not such a good deal. People had better wake up before it’s too late!! Tomg
GM is cutting contractors and offering VSPs in order to get money to transition to producing EVs that the majority of people don’t want, can’t afford, and the country’s electrical infrastructure can’t support. As I commented in various other articles this all-in mandate for EVs is going to bankrupt the auto industry – Ford losing money, GM stock dropping, and GM cannot fulfill their customer’s orders. This is just the start of their demise.
Wait a minute! I thought the demand for EVs was going to create countless jobs in Green Utopia…
that was from the idiot demented moron crooked joe the thief. the idiot that can;t wipe his butt or tie his shoes or board an airplane without falling down 3 times….. you know the thing,,,, cornpop. rode the train 3 million miles at 25 miles a week….no joke…. you know the moron that gets lost on the podium stage… you knoe the thing…..cornpop was a bad dude…you kniow thr thing .
This is nuts, GM can’t build trucks that people have ordered 6 months ago. Ordered a 1500 Danali on November 2nd, 2022, and still no truck. Gm is laying people off and can’t supply what the customer wants. That’s as stupid as it gets keep pushing that left new green deal and see what it will get you lost customers and lost sales. Who can afford an electric truck that can’t do the work of a truck. Thank you, Joe and GM., You have lost a customer that’s been buying GM all my life…….
Gotta find a way to keep increasing Mary Barry’s almost $30 million comp package somehow.
I’m reminded of the quote attributed to Marie Antoinette:
“Let them eat cake”
GM’s full-year 2022 revenue was $156.7 billion, net income attributable to stockholders was $9.9 billion and EBIT-adjusted was a record $14.5 billion, they have enough to pay Mary several times over.
…but cut workforce, close plants, not build and deliver long-standing customer orders, build in Mexico to skirt unions/costs/American jobs. and, of course, this article’s headline:
“GM Cut Hundreds Of Contract Workers This Weekend In New Cost-Reducing Measure”
Lofty numbers Bob, as GM is a huge company (and always has been), but that’s not the entire picture.
How do you shut down and eliminate a major corporation without saying you’re shutting down and eliminating a major corporation?
You are correct Mark.
GM global sales:
2016: 10.0 million
2022: 5.9 million (39% of those in China)
Mary’s misguided leadership, perhaps?
How can anyone on this board think those numbers are good?
Doesn’t help to capitulate on minivans, sedans, affordable trucks, and cars like the Camaro that were red hot and everywhere only 10 years ago…
HOPE THEY START WITH MARY –I m not interested in EV ,so good luck with your plan .
In the meantime, Mary continues to collect (not earn!) $28.9 million annually.