But this doesnt mean that investors should be worried about GMs future. Until recently, the automotive industrywas largelyunaffectedby job cuts that had plagued the technology sector in recent quarters. You can follow this link to learn about what cars GM is killing off. Mary Barra, CEO, GM at the NYSE, November 17, 2022. WebGeneral Motors said it is cutting salaried and executive staff after saying a month ago that it wasn't planning layoffs. Watch: US: General Motors on cost-cutting drive, cuts hundreds of jobs | World Business News. General Motors Cost Reduction Efforts During the companys Q4 2022 earnings call in January, CEO Mary Barra stated, I do want to be clear that were not Up to half of those savings are expected this year, he said. 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. GM's full-year 2022 revenue came in at $156.7 billion, with net income attributable to stockholders of $9.9 billion and adjusted earnings before interest and tax at All rights reserved. The average GM stock price target implies about 38% upside potential. The results come as the U.S. automotive industry is beginning to normalize after several years of record-low inventories. All in all, GM is planning to cut more than 14,000 jobs with the recent round of GM layoffs. GM is currently investing billions in electric vehicles after its Chevrolet Bolt EV and Bolt EUV saw record sales last year. Electric Vehicles More Affordable Than Gas? OBrient loves helping everyone understand the complexities of economics. On top of its EV push, General Motors is also working hard on developing its own EV battery platform, another likely growth catalyst on the road ahead. 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. I believe it is completely ok for a company trying to adapt to the changing market conditions and planning to produce vehicles that are preferred by the customers considering the environmental factors. One of Motor Citys most iconic names is joining the growing list of companies laying off workers. Most of the layoffs happened at GM's technical center, and most of those people worked on components for internal-combustion engines and discontinued car models. Share your stories and opinions with us here. As per the notice, they have invoked section 25 of the Industrial Dispute Act, wherein no permission is needed. 2022 CBS Broadcasting Inc. All Rights Reserved. Some of the best brands offered by General Motors are: With the turn in the 21st century, the world is growing in terms of advancement in technology and the concern for environmental protection seems to be mandatory for the automobile industry in order to sustain in the market. This is supposed to be the only company that has the capacity to produce self-driving vehicles at a scale with fully integrated solution. Article printed from InvestorPlace Media, https://investorplace.com/2023/03/general-motors-layoffs-2023-what-to-know-about-the-latest-gm-job-cuts/. It is considered that GM didnt build Oshawa rather Oshawa built General Motors. Sorry, you have Javascript Disabled! Both General Motors and Ford are investing billions in expanding their presence in the lucrative EV space. Get browser notifications for breaking news, live events, and exclusive reporting. The Company wants to adopt a new international strategy for serving the players in those markets in a better way. The company's broader attempts to streamline operations include the anticipated "low hundreds" of job cutbacks. The earnings bring GM's three-year total to $1.2 billion. The cutsstartedTuesday and will continue based onlocation. Follow her on Twitter@jlareauan. 1125 N. Charles St, Baltimore, MD 21201. There has been a wave of layoffs across corporate America, with major tech companies and Wall Street titans at the forefront. FLINT, Mich. (WJRT) - The global microchip shortage continues to affect Mid-Michigan auto workers. https://www.freep.com/story/money/cars/general-motors/2019/02/05/gm-layoffs-severance-pay/2778167002/, Feb 5, 2019 GM was in the second day Tuesday of massive salaried job cuts across its North American offices, targeting about 4,000 workers as part of a , Messages relating to layoffs at General Motors are presented below the company info. Sign up below to get this incredible offer! 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. 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. ", GM has "modeled several downturn scenarios," she said, and it's prepared to take "more deliberate action when and if necessary.". All of these plants will be closing down in 2019. We continue to shift resources to EVs with around 75% of our product specific capital dedicated to EVs and AVs [autonomous vehicles], said CFO Paul Jacobson during the Q4 earnings call. The 500 job cuts make up less than 1% of GM's salaried workforce. Here is the breakdown: 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 its inventory as U.S. sales slump. Last year, nearly one-third of its new hires were women and 42% were from underrepresented minority groups, it said. For the past decade, we have developed and perfected technology designed to help private investors, just like you, find the best opportunities, with the greatest upside potential, in any financial climate., Invest Like a Pro with Unique Data & Simplifed Tools, GM should be bought, not sold, on truck production cut, says BofA, GM to halt Indiana truck plant output for two weeks, Reuters says, General Motors subsidiary, Tawazun Council sign cooperation agreement. But more important to note is the fact that GM is in a period of transition. The opinions expressed in this article are those of the writer, subject to theInvestorPlace.comPublishing Guidelines. GM earned a record $14.5 billion for 2022, according to its CEO General Motors Co. has laid off 500 executive-level and salaried employees just a month after its Shares have advanced 15% so far in 2023. The given video in the CLA1 assignment talks about the strategic decision taken by the General Motors Company regarding cutting off its North American employees for the purpose of restructuring the organization. GM and other manufacturers' cost-cutting initiatives aim to improve their competitiveness and financial performance in light of difficult market conditions. It's working with partners to develop hydrogen fuel cell locomotives, aircraft and generators. The , https://www.washingtonpost.com/business/2018/11/26/gm-lay-off-percent-salaried-workers-halt-production-five-plants-us-canada/, Nov 26, 2018 Amid global restructuring, General Motors announced Monday it would reduce its North American production and salaried and executive . The decision by GM comes in response to similar actions taken by other significant automakers, such as Ford Motor and Stellantis, to cut expenses and streamline their operations. Executive Chair Bill Ford and CEO Jim Farley told Ford's 31,000 workers in a memo that to "tackle all aspects of costs from materials to those related to quality," Ford will reduce its salaried workforce by 2,000 and agency employees by 1,000. Copyright WebHome. Save my name, email, and website in this browser for the next time I comment. GM announces sweeping layoffs; spares Flint. He said GM is being "appropriately cautious" but vehicle inventories remain constrained amid strong demand. Stay up to date with our daily newsletter, Mercedes-Benz Cars To Have 'Supercomputers', Unveils Google Partnership, U.S. Manufacturers See Big Boost From Government Subsidies And Tax Breaks. Backtested results are calculated by the retroactive application of a model constructed on the basis of historical data and based on assumptions integral to the model which may or may not be testable and are subject to losses. As of December 2022, GM employed about 86,000 hourly employees and 81,000 salaried employees worldwide. "This action impacts a small number of salaried employees and executives globally.". The strong report suggests GM is hanging onto record, or near-record, results even as the U.S. automotive industry begins to normalize after several years of record-low inventories and resilient consumer demand. DETROIT General Motors handily beat Wall Street's top- and bottom-line expectations for the fourth quarter, while forecasting another solid year of results in 2023. According to the Detroit News, a General Motors spokesperson said, Todays action follows our most recent performance calibration and supports managing the attrition curve as part of our overall structural costs reduction effort.. Contact Jamie L. LaReau: jlareau@freepress.com. EA Lays Off 350 People In Marketing, Publishing, And More. During the companys Q4 2022 earnings call in January, CEO Mary Barra stated, I do want to be clear that were not planning layoffs. Barra said the company is targeting $2 billion in cost savings in its automotive business over the next two years. In a letter to shareholders on Jan. 31, Barra said that the company earned a record $14.5 billion for 2022 while its hourly employees earned a record profit-sharing totaling $500 million. Overview Of General Motors And Toyota. GM is planning to stop building vehicles with poor sales and which are not preferred by the customers. Last year GM hired over 10,000 people worldwide, with one-third of them in software engineering jobs. General Motors expects its 2023 capital expenditure in the range of $11 billion to $13 billion. "In order to execute against that, we need to bring in thousands and thousands of tech talent," he said. Read more onGeneral Motorsand sign up for ourautos newsletter. Barra said last quarter that GM has "a foundation of strong earnings and cash flow, an investment-grade credit rating, historically low pension obligation and outstanding vehicles, services and pricing. That means that, while no layoffs loom in the near future, GM is "being prudent in limiting our hiring to critical skill sets," Raynal added. The cuts affect about 500 positions, according to a person familiar with the plans, which were announced internally Tuesday. It will be cutting around 500 executive level positions. Retrieved from MakeInnovationWork: https://medium.com/make-innovation-work/what-gms-layoffs-tell-us-about-disruption-in-the-automotive-sector-383b96ec1b04, Schreier, J. Mary Barra, CEO, GM at the NYSE, November 17, 2022. Backtested performance is not an indicator of future actual results. As per my analysis, the Company is not obliged to prioritize the ancillary units that are affected by the layoffs and plant shutdowns than their own Company. The company is hyper-focused on shifting its resources and operations to electric vehicle (EV) production. The cuts affect about 500 positions, according to a person familiar with the plans, which were announced internally Tuesday. quotes delayed at least 15 minutes, all others at least 20 minutes. GMs layoffs start Monday, at least 4,000 expected to lose jobs. The company has been moving to expand its revenue sources with ventures outside of selling automobiles. (2019, March 26). Most investors dont have major gainers like TSLA or NVDA on their radar from the start. It was the stock's best daily performance since Oct. 4. Jacobson told investors last month that the company expected to reduce employee headcount through attrition rather than layoffs. Notify me of follow-up comments by email. The hiring spree contrasts with February of 2019, when GM cut about 8,000 white-collar workers worldwide as part of a restructuring that added $2.5 billion to the company's bottom line. Since late 2020, it has added about 21,000 technical positions. 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). As of December 2022, GM had about 86,000 hourly employees and 81,000 salaried employees worldwide. General Motors (NYSE: GM) had previously been trying to hold out on job cuts. Retrieved from Kotaku: https://kotaku.com/ea-lays-off-350-people-in-marketing-publishing-analyt-1833575289. A "significant" portion of the cuts will be in Michigan, Ford spokesman Mark Truby said. Those results marked the high-end of the company's previously revised guidance. The decision of sweeping GM Layoffs didnt affect the stock price of the GM as it was presented in the video which is actually dependent on the customer buying behavior and how the customer feels the company is going to perform in the nearby future. The company is providing severance for the employees that are laid off. Job cuts: Many American firms have been downsizing to manage costs. Copyright 2023 IBTimes LLC. Donald Trump also threatened General Motors that he will be cutting all the subsidies that have been provided to them. 2022 Associated Press. 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 The amount of customers buying cars in the U.S. is down, which has the company shifting focus toward other products. He is ranked in the top 15% of stock pickers on TipRanks. 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