GM shutting 5 plants in North America

[2 Sweet]

https://www.cnn.com/2018/11/26/business/gm-oshawa-plant/index.html

 

New York (CNN Business)General Motors on Monday announced a major restructuring of its global business, saying it will shut production at five facilities in North America and slash its staff. GM will reduce its salaried workforce by 15%, including a quarter of the company's executives.

 

The moves are the first big steps in the century-old GM's transformation. The company is reinvesting money away from cars that once dominated America's roadways and putting it into technology it believes will power its future.

 

GM's (GM) new motto is "Zero Crashes, Zero Emissions, Zero Congestion," signaling a shift to self-driving, electric vehicles. But the restructuring is also about making cars people want now. Customers are increasingly shunning sedans in favor of SUVs and hatchbacks.

 

The company said the plan would make it more efficient, saving $6 billion a year by the end of 2020. GM said its slimmed down production plan would allow it to share technology across all of its vehicles and reduce the amount of time and workers it takes to build cars.

 

"The actions we are taking today continue our transformation to be highly agile, resilient and profitable, while giving us the flexibility to invest in the future," said CEO Mary Barra, in a statement.

 

GM said it would shut operations at plants in Detroit; Oshawa, Ontario; Warren, Ohio; White Marsh, Maryland; and Warren, Michigan. The plants made sedans that have waned in popularity, including the Chevrolet Volt, Impala and Cruze, the Buick LaCrosse, and the Cadillac CT6 and XTS. GM said it will no longer make those cars.

 

Two of the plants made engines and parts for those cars. The facilities made some trucks, but those trucks are also made in Mexico.

 

The company also said it would close three plants outside North America by the end of next year. One of those closures, in South Korea, had been previously announced.

 

The transition will come at the expense of about 8,000 salaried workers, and 6,000 hourly workers will either lose their jobs or be reassigned to other plants. The company last month offered voluntary buyouts for 18,000 salaried workers.

 

The company, which was incorporated in 1908, is performing reasonably well — earnings are up and the balance sheet is healthy. But sales are starting to slip in China and North America, two of GM's biggest and most important markets.

 

Barra said in a conference call with reporters that she wanted to transition the company when times were good. That brought praise from Wall Street: GM's stock rose more than 5% Monday.

 

"In contrast to times past, General Motors, under CEO Mary Barra, is trying to get ahead of a potential crisis by making cuts now," said Michelle Krebs, executive analyst at Autotrader.

 

It is battling rival automakers to be first in line to mass-produce the cars of the future. Ford (F) announced in April it would just about end all production of sedans in North America.

 

But the next automaking leader may not be GM or one of its traditional rivals. Alphabet (GOOGL), Apple (AAPL), Uber and Tesla (TSLA) are leading Silicon Valley's push into the self-driving cars. That's why GM bought Cruise, a separate company with big backing from SoftBank and Honda. GM expects to spend $1 billion on Cruise this year to build the next generation of cars.

 

In the meantime, GM is trying to reinvent how it makes vehicles. It will share more components across cars and make better use of computer models and virtual tools. It will integrate its vehicle and engine engineering teams, and it will bring more employees together, trimming the number of campuses for car developers.

 

The soon-to-be shuttered North American plants are the first to close since 2010.

 

"While this may be a market necessity, I am concerned about the brain drain: a loss of valuable legacy knowledge and experience as long-term GM employees are let go," said Rebecca Lindland, executive analyst at Kelley Blue Book.

 

The Oshawa plant, located just outside of Toronto, was built in 1953. But Chevrolet has been making cars in Oshawa for more than a century. Over the years, Oshawa has been responsible for producing cars from GM's most important brands, including Chevrolet, Buick and Pontiac, and it is equipped to make just about every model GM sells.

 

Canadian Prime Minister Justin Trudeau said he was "deeply disappointed" by the decision to shut the Oshawa, Ontario plant. "GM workers have been part of the heart and soul of Oshawa for generations - and we'll do everything we can to help the families affected by this news get back on their feet."

 

GM's unions aren't happy. The union that represents its Canadian workers said in a statement that GM's expected decision does not "live up to the spirit" of certain commitments the company made to union members during 2016 contract negotiations. Some workers at the Oshawa plant walked off the job Monday.

 

The four American plants employ a combined 3,800 hourly and salaried staff, and the Oshawa facility employs 2,200. The Detroit-Hamtramck facility is GM's last in the city, and the Lordstown plant in Ohio was one of its biggest.

The United Autoworkers union said it would fight the decision.

 

"This callous decision by GM to reduce or cease operations in American plants, while opening or increasing production in Mexico and China plants for sales to American consumers, is, in its implementation, profoundly damaging to our American workforce," said Terry Dittes, UAW vice president.

[Geeto67]

saw that this morning and this:

 

https://jalopnik.com/gm-may-also-close-its-lordstown-ohio-plant-amid-global-1830654246

 

That's a lot of people to be laid off in lordstown.

[TTQ B4U]

Not sure how I feel about all this except that it's likely a move that is past-due. I drove through a few dealerships yesterday killing time and including the car I drive now, there's really nothing that WOW'd me. It was to the point that it made me think about how there are so many different vehicles out there that I don't want I wondered if they were even selling.

 

I'm still a sedan driver and will likely continue to be but I do still miss the softer more luxurious ride of a larger SUV. If I pulled the trigger today and started over I would have chose a performance SUV and likely gotten a bit of both of my desires. The downside when looking is the 500hp Stelvio wasn't out yet and it was certainly commanding a pretty penny. Same with the SRT's and more Jeeps. Most of them are just stupid in pricing. I drove a co-workers Telsa again, and I still waffle on pulling the trigger there but his SUV was $120k. Talk about a huge price tag for an SUV. He loves it and that beast move out like nothing I've driven before.

[Zx2guy19]

I can hardly take all this winning.

[99StockGT]

I can hardly take all this winning.

 

*slow clap*

[cdk 4219]

You do remember the GM Obama bailout? Pretty hard to compete globally and pay United States wages. This has not much to do with the current president. Between lawsuits and wages, manufacturing in the USA for a product like this is difficult at best. Full benefits , with 401k and dental insurance. It takes half a day to do an hours work in the US due to government rules and lawsuits. You are going to see the continuing decline of what was built 50 to 150 years ago.

[aussiek2000]

It costs GM (and all UAW manufactures) a shit load to pay they employees and benefits. I wouldn't be surprised one bit if these plants are later reopened with no unions. We are selling the piece of shit Buick Envisions and Encores like hot cakes, which are both built overseas.

[Not Brian]

Next time you're driving on the freeway, take a second to look around you. Nothing but SUVs and trucks. No reason for a business to continue making something (sedans) that nobody wants. That's like working in the fart-flavored branch of a cookie company and getting miffed when they shut you down.

[Otis Nice]

Next time you're driving on the freeway, take a second to look around you. Nothing but SUVs and trucks. No reason for a business to continue making something (sedans) that nobody wants. That's like working in the fart-flavored branch of a cookie company and getting miffed when they shut you down.

 

TIL: GM is the fart flavored cookie of the vehicle world.

[Not Brian]

TIL: GM is the fart flavored cookie of the vehicle world.

 

Since clicking a link, reading the article, and comprehending somebody else's fitting analogy is a struggle for you, let me break it down: GM is closing plants which build sedans in America because we aren't buying domestic sedans. The analogy is that those 5 plants are making said fart flavors. Think of GM trucks and SUVs as chocolate chip or peanut butter cookies.

[Otis Nice]

Since clicking a link, reading the article, and comprehending somebody else's fitting analogy is a struggle for you, let me break it down: GM is closing plants which build sedans in America because we aren't buying domestic sedans. The analogy is that those 5 plants are making said fart flavors. Think of GM trucks and SUVs as chocolate chip or peanut butter cookies.

 

:gabe: Got 'im.

 

...in for PB cookies.

 

Also, I agree with you, but it's not ALL sedans. They still sell...right? I mean, def more trucks and SUVs (minivans) on the roads these days for sure, but aren't sedans still plentiful?

[Not Brian]

The profit margins are slim with domestic sedans. Foreign sales are way higher.

[ShowHBK]

If GM had a flavor it would be water...

 

They make nothing interesting, have VERY misleading commercials, and have a horrible sense of identity (IMO). I'm sorry to anyone who loves their GM (brand) vehicle, but the company has done little to change my mind since their bailout. I want to love the camaro, but every time I drive one, I can't see out of the damn thing and the new front end looks like a bloated man going for seconds at the "all you can eat" buffet.

[Not Brian]

Yeah the 2019 Camaro sales are fucking abysmal. I read somewhere they're scrambling to redesign it for 2020.

[Otis Nice]

Yeah the 2019 Camaro sales are fucking abysmal. I read somewhere they're scrambling to redesign it for 2020.

 

 

or :gtfo:

[coltboostin]

My uncle retired from Chevy making 54$/hr.+ full Medical+full pension. He would often joke that he would fall asleep on the job, and his job was turing 6 bolts on a v6 water pumps (with a preset pneumatic torque wrench). I love him to death, but any trained Monkey would have been happy doing his job for 17.50/hr and half the benefits.

 

The UAW is maybe the single largest reason it's difficult fr US Automakers to compete globally

 

 

I wonder what the CEO's pay cut will be?

[10phone2]

If GM had a flavor it would be water...

 

They make nothing interesting, have VERY misleading commercials, and have a horrible sense of identity (IMO). I'm sorry to anyone who loves their GM (brand) vehicle, but the company has done little to change my mind since their bailout. I want to love the camaro, but every time I drive one, I can't see out of the damn thing and the new front end looks like a bloated man going for seconds at the "all you can eat" buffet.

 

pretty spot on. I doubt my wife and I will ever buy a new car unless she had to travel stupid miles for work. The prices and the tons of options the new cars come with that i have zero use for is will likely always keep us away.

[Cordell]

You know I have a real love for GM, but I have no interest in $60k+ trucks and SUVs. Most of their new 4 cylinders are problematic, and the cars are not that great to look at. I personally like the new Camaro and Corvette, but I can’t see myself going that far in debt for a toy. I think there are enthusiasts that are traditionally into GM, but have similar feelings. It’s sad.

 

Most of what I work on everyday is 4 cylinders with cracked pistons, or engines burning large amounts of oil, or glitchey infotainment systems. I see a much larger amount of smaller SUVs and crossovers getting serviced then anything else.

 

So in short none of this surprises me. What I find annoying is the UAW and the press shaming GM. People don’t buy these products and GM has to make changes to keep from going bankrupt again, if you don’t like it run out and buy some cars. The UAW is is going to kill GM, and the media is on board because it’s a god damned union. This is all going to be a political mess until they come up with something else to bitch about.

Edited November 27, 2018 by Cordell

[craig71188]

My uncle retired from Chevy making 54$/hr.+ full Medical+full pension. He would often joke that he would fall asleep on the job, and his job was turing 6 bolts on a v6 water pumps (with a preset pneumatic torque wrench). I love him to death, but any trained Monkey would have been happy doing his job for 17.50/hr and half the benefits.

 

The UAW is maybe the single largest reason it's difficult fr US Automakers to compete globally

 

 

I wonder what the CEO's pay cut will be?

 

This! 20+ years ago I believe the number quoted was 35% of a new vehicle cost was for Union pension/benefits. Now the UAW wants to stop GM from closing facilities? I'm sorry, we are bankrupting you, but you must continue to lose money as long as we're getting it???

[BStowers023]

The new Denali trucks are beautiful but there aren't a whole lot of people that fit the demographic to buy one. As far as cars go, I hate to say it but I'd prefer a Kia Optima over a Chevy Malibu. Talk about boring.

[Fiji ST]

My uncle retired from Chevy making 54$/hr.+ full Medical+full pension. He would often joke that he would fall asleep on the job, and his job was turing 6 bolts on a v6 water pumps (with a preset pneumatic torque wrench). I love him to death, but any trained Monkey would have been happy doing his job for 17.50/hr and half the benefits.

 

The UAW is maybe the single largest reason it's difficult fr US Automakers to compete globally

 

 

I wonder what the CEO's pay cut will be?

 

So in short none of this surprises me. What I find annoying is the UAW and the press shaming GM. People don’t buy these products and GM has to make changes to keep from going bankrupt again, if you don’t like it run out and buy some cars. The UAW is is going to kill GM, and the media is on board because it’s a god damned union. This is all going to be a political mess until they come up with something else to bitch about.

 

1,000,000% this.

[zeitgeist57]

Why GM is $37/share and Ford hasn't seen over $12/share in almost a year is beyond me. Ford stopped US-market car sales aside from Mustang and surprised no one as to why after a month of digesting the news. Still makes global product that sells well in multiple markets, and has been doing so since the Focus was introduced back in 2000. F-150 is a 40-year best seller. Mustang outsells Camaro by a 3x margin. Ecosport doesn't sell well here but who cares? It makes money internationally.

 

As a current Silverado/Cavalier/CTS-V owner and a lover of the Corvette, I do feel that GM lost their way with products. The "Fiero Syndrome" is strong with GM, and it's depressing.

http://jalopnik.com/the-cadillac-ct6-v-is-still-happening-and-will-go-out-i-1830663592

Tells me GM management doesn't know what the client wants, doesn't care, or truly can't produce a product that the market will buy (aside from trucks/SUVs and Corvette).

 

To Cordell's points (of which I value his experience on GM products) I pay attention to even mundane DD vehicles and every early-'10s Equinox I see has some sort of loud engine rattle or worse. My neighbor has a '12 Equinox and the exhaust is totally rusted away. I told him there is no "fix", to just get some Walker parts online and I can replace them for him. He seemed rightfully miffed for a sub 125k-mile vehicle that's 6 years old and parks in a garage. When peeps ask me for an SUV recommendation, anyone who's buying instead of leasing I recommend a NON-GM product. If you want the FWD Acadia for a cheap monthly car payment on a lease, go get sucked into that POS and f**k off.

 

Keeping an eye on the market for a used Model S for our family...wifey's orders.

 

/rant off

[Cordell]

Yes the 2010-2013 or so Equinoxes are absolute crap, mostly with the 2.4L driveline. I’ve done pistons in so many of them I’ve got it down to 5.5-6 hours from tear down to test drive. After the first few years they got a little better but not much. The exhaust manifolds crack, the PCV system clogs and blows out the rear main seal, the high pressure fuel pump leaks, the balance chain rattles, the cam actuators fail (mostly due to oil starvation, see issue #1), and the camshaft solenoids fail.

 

I’ve gone on about the Acadia, Traverse, ect before, I’ll not bother with that again. GM has pissed off enough people with a few of these popular vehicles, again I’m not surprised.

[iwashmycar]

Did they really pay back the bailout? Thought I saw that somewhere.

[Gergwheel1647545492]

Mustang outsells Camaro by a 3x margin.

 

 

Camaro: 2016 - 72,705; 2017 - 67,940

http://gmauthority.com/blog/2018/01/chevrolet-camaro-sales-numbers-figures-results-december-2017/

 

Mustang: 2016 - 105,932; 2017 - 81,866

http://fordauthority.com/fmc/ford-motor-company-sales-numbers/ford-sales-numbers/ford-mustang-sales-numbers/