(ProsperNews.net) – General Motors (GM) will lay off more than 1,300 workers despite receiving millions from state taxpayers. A total of 1,314 employees will be fired from two production plants in Michigan, with 945 at the Orion Assembly plant to lose their jobs on January 1. At the Lansing Grand River Assembly/Stamping plant in Lansing, sackings will begin on day one of 2024 and continue through to March.
The cuts are related to the company’s decision to reduce production of electric vehicles (EVs) due to a lack of customer demand.
In October, GM abandoned its plans to produce 400,000 EVs by the end of 2024, saying competition had increased, demand had slowed, and the plans were no longer profitable. CEO Mary Barra said the company would take immediate steps “to enhance profitability,” and these steps include “moderating the pace of our EV acceleration in 2024 and 2025.”
The EV market across the US slowed in 2023, with many consumers saying they are not ready to make the transition, partly due to a lack of charging stations, cost, and the fear that EVs will not be as powerful as their gasoline counterparts. Experts say a drop in gas prices to $3 nationally has also made consumers pause.
The layoffs in Michigan may come as a surprise because Governor Gretchen Whitmer gave GM a financial boost last year in return for job creation promises. In 2022, Governor Whitmer said she intended to elevate Michigan to the country’s largest EV producer and secured a deal with Mary Barra that cost the taxpayer $824 million. GM promised to convert its Lansing plant into an EV producer and create thousands of jobs.
In mid-December, GM also announced it would cut 900 jobs from its driverless cab firm, Cruise. The layoffs amount to 24% of its workforce and were announced after a Cruise vehicle hit a pedestrian in San Francisco. The incident prompted the company to recall more than 900 driverless cars.
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