GM said in a statement Wednesday that it's expanding teams that develop vehicle software, engineer hydrogen fuel cells for non-automotive uses, and develop new battery designs. General Motors Co. has laid off 500 executive-level and salaried employees just a month after its CEO said the company was "not planning layoffs" amid major job cuts across the automotive industry. Those results marked the high-end of the company's previously revised guidance. The company has a "work appropriately" policy that gives employees flexibility to work where they want, when the work permits. Cutting 500 jobs out of 81,000 is a very small percentage. after saying earlier this year that it didnt plan layoffs. It was the stock's best daily performance since Oct. 4. When it reported 2022 Q4 earnings on Jan. 31, CEO Mary Barra stated, I do want to be clear that were not planning layoffs.. GM had alreadyhired 7,000 new salaried workersthis year, saidspokeswoman Maria Raynal. Become a subscriber. But this doesnt mean that investors should be worried about GMs future. For those thousands of employees affected by layoffs, the company plans in providing many severance programs so that their lives to a better extent. The earnings bring GM's three-year total to $1.2 billion. CBSNews. GM continues to expect to meet its full-year earnings guidance. Sorry, you have Javascript Disabled! WebDamascus Motors is a licensed Maryland used car dealership. But Barra said there continues to be good demand for GM's big pickups and SUVs, which deliver fat profits. GM has no plans to follow in its arch rivals footsteps, however, with a spokesperson confirming it has executed other cost reduction measures and will not lay But for GM , a company that employs 180,000 people , https://www.cnbc.com/2019/02/01/gm-readies-to-make-4000-involuntary-layoffs-next-week.html, Feb 1, 2019 General Motors is planning to layoff at least 4,000 salaried workers in North America starting Monday ahead of the companys fourth-quarter , https://www.reuters.com/article/us-gm-layoffs/gm-cutting-4000-workers-in-latest-round-of-restructuring-idUSKCN1PT21Z, Feb 4, 2019 GM is also cutting its executive ranks by 25 percent and last week laid off three senior people in its Washington office and some other small , https://abcnews.go.com/Business/story?id=6053665&page=1, DETROIT Another 1,600 workers at three General Motors gm factories will be laid off indefinitely over the next few months as the company tries to control , https://www.theguardian.com/business/2018/dec/27/general-motors-ohio-auto-car-layoffs, Dec 27, 2018 GM stunned its workforce on 26 November, the Monday after Thanksgiving, by announcing it would cut roughly 14,000 jobs and idle five factories , https://www.cnn.com/2020/06/25/business/gm-layoffs-tennessee-covid/index.html, Jun 25, 2020 The company is eliminating the third shift of workers at a plant as of July 31 in Spring Hill, Tennessee, about 40 miles south of Nashville. ", GM has "modeled several downturn scenarios," she said, and it's prepared to take "more deliberate action when and if necessary.". WebGeneral Motors said it is cutting salaried and executive staff after saying a month ago that it wasn't planning layoffs. It enjoyed some growth in early February after announcing a partnership with chipmaker GlobalFoundries (NASDAQ:GFS), but the momentum has since faded. About 700 workers at GMs pickup plant in Pontiac will be furloughed starting Feb. GM white-collar job cuts: How layoff process is happening, Why The General Motors Layoffs Were Strategic Forbes, GMs layoffs start Monday, at least 4,000 expected to lose jobs, GM cutting 4000 workers in latest round of restructuring, GM will lay off 1,600 workers at 3 factories ABC News, Why GMs mistaken bet led to major layoffs YouTube, A kick in the stomach: massive GM layoffs leave workers , GM cuts 700 jobs because of weak sales it blames on Covid-19, GM to lay off 15 percent of salaried workers, halt production at , Can You Be Laid Off While On Medical Leave, Can A Company Find Out If You Were Laid Off, Can You Say You Were Laid Off Instead Of Fired, Can You Go On Disability After Being Laid Off, Can You Be Laid Off While On Short-Term Disability. And I believe that the decision taken by General Motors regarding restructuring and shift toward the future-forward technology of electric cars and automated self-driving cars is right. Electric Vehicles More Affordable Than Gas? Retrieved from Aierfu: http://aierfu.cc/en/NewscenterDetails.asp?newsid=46, Jones, S. (2019, February 2). That vehicle is expected to be followed by an electric Chevrolet Silverado work truck by midyear and electric versions of the Chevrolet Blazer and Equinox during the second half of 2023. The hires don't hurt the bottom line, and they help to achieve the GM's targets, said Jessika Lora, GM''s director of global innovation. "We continue to shift resources to EVs, with around 75% of our product-specific capital dedicated to EVs and AVs," GM CFO Paul Jacobson said on Jan. 31, as quoted by the same outlet. DETROIT General Motors is cutting hundreds of salaried positions as it follows other major companies, including competitors, in downsizing headcounts to preserve cash and boost profits. Those results would be below 2022 earnings, but above average analyst forecasts compiled by Refinitv that called for EPS of $5.73 this year. In an interview with Bloomberg last month, CFO Paul Jacobson said, "We went through a fairly big restructuring back in 2018 in which the company, prior to my arrival, did an amazing job of saving $4 billion to $4.5 billion annually and paving the way for the investments that we need to make in the cost structure to produce EVs.". The company has been also planning to shut down its five big plants four in America and one in Canada which are as follows: The given video about GM Layoffs explains that one of the GMs Canadian plants at Oshawa, Ontario which produces Chevrolet Impala is the home for General Motors and it has been more than a decade the company is operating there (Feick, 2018). New hires don't necessarily have to work at the company's technical center in the Detroit suburb of Warren, Michigan. Please note all regulatory considerations regarding the presentation of fees must be taken into account. It will be cutting around 500 executive level positions. It all happens at the free AI Super Summit. In 2018 and 2019, GM cut about 4,000 salaried jobs,mostly in North America,as part of its restructuring. GM expects some head count reduction due to attrition but the company is "not planning layoffs," Jacobson said. GM will execute a $2 billion cost-cutting plan through the next two years, according to Jacobson. A Division of NBCUniversal. The results come as the U.S. automotive industry is beginning to normalize after several years of record-low inventories. But more important to note is the fact that GM is in a period of transition. "Today's action follows our most recent performance calibration and supports managing the attrition curve as part of our overall structural costs reduction effort," spokesman David Barnas said in a statement Tuesday. From the video case, it has been clear that the customers no longer want those types of products that have been produced by the plants that are being shut down by 2019. General Motors believes in bringing innovation with the adaptation of new technologies that is preferred by the users as it meets their need and demand of having a vehicle that is comfortable, spacious, and luxurious. It is shown in the video that the GM didnt close any Mexican and Chinese GM plants might be because of the far below low wages in those countries than in America. General Motors (NYSE:GM) had previously been trying to hold out on job cuts. On GM to lay off 4,250 salaried workers in North America starting Monday. WebHome. They will be across various functions of the company, said the person, who asked not to be named because the plans are not public. The president promises that there will be auto jobs coming to the people around the places like Ohio where the massive layoffs by General Motors are taking Certain assumptions have been made for modeling purposes and are unlikely to be realized. Notify me of follow-up comments by email. TipRanks is a comprehensive research tool that helps investors make better, data-driven investment decisions. The impacted employees will be provided with 50% of their basic pay and allowance, as per their last drawn salary. GM is planning to stop building vehicles with poor sales and which are not preferred by the customers. Can You Get Laid Off While On Maternity Leave, Can Laid Off Union Workers Collect Unemployment, How Long Does Insurance Last After Being Laid Off. Shares have advanced 15% so far in 2023. As growth slows in the world's largest economies, additional layoffs are anticipated this year. (2018, November 27). The cost-cutting drive comes after GM's announcement in January that it aims to save $2 billion in costs over the next two years. The company believes that it is better to do restructuring when both the company and economy are strong. Electronic Arts, which is considered as one of the leading American Video Game Company around the world plans to cut 350 of its employees in the marketing, publishing, and other areas which includes closing offices in Japan and Russia (Schreier, 2019). General assumptions include: XYZ firm would have been able to purchase the securities recommended by the model and the markets were sufficiently liquid to permit all trading. You can view a list of Rapid Response GM notes that the major changes to its plants structure and employee headcount has to do with the preference from customers. All in all, GM is planning to cut more than 14,000 jobs with the recent round of GM layoffs. GM's net income slipped last year, down by less than 1% from full-year 2021 to $9.9 billion, with a profit margin that was off 1.6 percentage points to 6.3%. All Rights Reserved. General Motors always believed in bringing innovation with the adaptation of new technologies that is preferred by the users as it meets their need and demand of having a vehicle that is comfortable, spacious and luxurious (James, 2011). The area around the plant is designed in such a way that the shutting down of the GM plant will affect the entire city. 2023 CBS Broadcasting Inc. All Rights Reserved. Follow her on Twitter@jlareauan. Article printed from InvestorPlace Media, https://investorplace.com/2023/03/general-motors-layoffs-2023-what-to-know-about-the-latest-gm-job-cuts/. Job cuts: Many American firms have been downsizing to manage costs. Just over one month later, however, the auto giant has announced that it will be cutting roughly 500 salaried jobs, chiefly at the executive level. Further, the CEO called 2023 the company's "breakout year" since they expect to deliver $10.5 billion to $12.5 billion in profits for this year. The company is more focused on innovation which led it to shift towards electric cars and automated self-driving cars in the future. The recent move contradicts GM CEO Mary Barra's statement during an earnings call in January that the company was not planning layoffs amid cost-cutting strategies. The letter said the cuts, which follow performance evaluations, wouldimpact a "small number of global executives and classified employees following our most recent performance calibration." GM is currently investing billions in electric vehicles after its Chevrolet Bolt EV and Bolt EUV saw record sales last year. The Company took this strategic decision in order to cope with the changing environment, deliver all those commitments, and improve customer service by meeting the needs of the players. A brief introduction of the General Motors. The amount of customers buying cars in the U.S. is down, which has the company shifting focus toward other products. Lorem ipsum dolor sit amet, consectetur adipiscing elit. CEO Mary Barra assured Wall Streetthat the company is taking cost-cutting measures, such as dialing back on new hires,and is prepared to do more if needed. It expects adjusted earnings before interest and taxes of $10.5 billion to $12.5 billion and adjusted earnings per share of between $6 and $7. At the end of 2022, General Motors employed about 86,000 hourly workers and 81,000 salaried employees worldwide. GM feels they need to optimize themselves as per the change in market conditions and preferences of the customers in order to position themselves in the long-run. The cost-cutting drive comes after GM's announcement in January that it aims to save $2 billion in costs over the next two years. 1125 N. Charles St, Baltimore, MD 21201. Todays action follows our most recent This includes the following plants. General Motors' fourth-quarter results easily topped a year earlier. Company information: Industry/Area of Activity: Autos & Auto Parts; Company , https://www.forbes.com/sites/stephaniedenning/2018/11/29/why-the-general-motors-layoffs-were-strategic/, Nov 29, 2018 Smallish-Scale Layoffs : By most benchmarks, cutting 14,000 employees is a large-scale layoff . Tue, July 26, 2022 DETROIT, July 26, 2022 /PRNewswire/ -- General Motors Co. (NYSE: GM) today reported second-quarter net income attributable to stockholders of $1.7 billion and EBIT-adjusted of $2.3 billion, in line with the earnings update the company issued on July 1. Watch: US: General Motors on cost-cutting drive, cuts hundreds of jobs | World Business News. All Rights Reserved. All of these plants will be closing down in 2019. Customers are the king of any business and if the business does not try to adapt to the changing demand of customers it will no longer sustain in the long run and can make a profitable business. By Poornima Gupta. This information is provided for illustrative purposes only. On March 2, This AI "Roadmap" Goes Live. All of this will help us continue to execute our growth strategy and insulate it from short-term market challenges.. During the companys Q4 2022 earnings call in January, CEO Mary Barra stated, I do want to be clear that were not planning layoffs.. Still, the automaker is showing signs of a margin squeeze. 2023 InvestorPlace Media, LLC. (2011, May 17). He said GM is being "appropriately cautious" but vehicle inventories remain constrained amid strong demand. GMs layoffs start Monday, at least 4,000 expected to lose jobs. Also, the tariff that has been imposed by the US president on steel and aluminum is costing automakers in America around the extra cost of billions of dollars which has created a big market shift. OBrient loves helping everyone understand the complexities of economics. 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