In an unprecedented announcement on Monday morning, General Motors confirmed it would begin a restructuring effort that will require significant slashes to its existing workforce. A total of 14,000 layoffs are expected, with more than 6,700 being factory workers, according to a company statement.
GM would not say that it was shutting down plants in entirety, as closure requires significant negotiation work with unions and employees, rather that it would no longer allocate production to on eight of its manufacturing facilities worldwide (five of which are in North America) past specified dates in 2019.
In total, 6,705 jobs will be affected by the North American plant restructuring alone. The United States houses 57 percent of the impacted positions (3,807 jobs) at four separate facilities in Maryland, Michigan, and Ohio. As many as 2,900 Canadian workers will also be affected, all of which are located at the Oshawa Autoplex in Ontario, Canada. Below is the breakdown per-facility for all 6,705 jobs:
- Oshawa Assembly Plant: 2,900
- Detroit-Hamtramck Assembly Plant: 1,542
- Lordstown Assembly Plant: 1,618
- Warren Transmission Operations: 335
- Baltimore Operations: 310
In a statement regarding its restructuring, GM wrote that it would be closing three additional overseas facilities by end-of-year 2019, one of which was previously announced in Gunsan, Korea. There is no data readily available to provide on the number of overseas jobs that will be lost due to restructuring.
In addition to the factory workers, GM will seek to reduce salaried staff by 15 percent, or around 8,100 employees. Together with the 6,700 plant layoffs, this number represents an estimated 14,807 jobs or 8.2 percent of GM’s 180,000 workers.
The total layoffs coincide with a previous report penned by The Drive last week, regarding GM seeking 7,000 salaried employees to volunteer for a buyout offer and compensation package as a cost-cutting measure. It was estimated that GM would fall short of its target by around 3,000 workers, prompting the company to seek out forced layoffs as part of its alternative initiative.
Statistics provided by GM show that 86 percent of the layoffs will be for hourly-rated employees, with Oshawa taking the largest hit at 88 percent non-salaried workers. This is closely followed by the Lordstown Assembly plant in Ohio with 87 percent of layoffs being hourly-rated, and Detroit-Hamtramck at 86 percent. Earlier this year, GM processed nearly 1,500 layoffs at its Lordstown, Ohio Assembly plant.
“There will be a combination of retirements (salaried) and layoffs as well as the opportunity for employees to transfer to other open positions in accordance with the applicable labor contract or personnel policy language,” a GM spokesperson told The Drive via email. “GM and leaders from the UAW/Unifor will have discussions regarding applicable national contract provisions for impacted hourly employees. The Human Resources organization will help identify options and opportunities for salaried employees.”
GM says that it expects to spend between $3 billion and $3.8 billion on the restructuring. As a result, it plans to reap nearly $6 billion in annual savings.