April 20, 2021

General Motors will close seven factories and reduce its workforce by 15%

General Motors will close seven factories and reduce its workforce by 15%


General Motors (GM) today announced a tough adjustment plan that includes the closure of seven factories around the world. The automaker has explained in a statement that it will close two assembly plants in the United States and one in Canada, as well as two others not identified in other countries. GM has also added that it will close two engine production factories in the US. The five North American plants affected by the announcement (Oshawa, Detroit-Hamtramck, Lordstown, the three vehicle assembly, and Baltimore and Warren, which produce engines and transmissions) employ about 14,500 people. The company has not specified in its statement the number of workers who will lose their jobs, but stressed that "actions are being taken to reduce" the workforce by 15%, a percentage that includes "25% fewer executives to expedite the decision making".

Along with the closure of these plants, GM has announced that by the end of 2019 production will cease in two other factories located outside North America, without offering more details, although it will do so soon. These seven closures are added to the already announced Gunsan assembly plant in South Korea, according to Efe.

The company has indicated that these measures are part of a process of "transformation for the future" and "reorganization" of its global workforce to "align its manufacturing capacity". According to GM, the closures will allow savings of about 6,000 million dollars. "The actions we are taking today continue our transformation to be very agile, resilient and profitable while giving us the flexibility to invest in the future," said GM President and CEO Mary Barra. "We recognize the need to stay ahead of changing market conditions and consumer preferences so that our company is in a position to achieve long-term success," Barra added.

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