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GM to slash jobs and production as USA sedan sales sink

27 November 2018

Workers at the General Motors plant in Oshawa have stopped working as they wait for details on the company's plan to close the facility.

General Motors announced Monday that it plans to lay off roughly 14,700 workers, a number which represents 15 percent of all its salaried employees.

GM said it is eliminating several models as it reduces production capacity to focus on battery-powered vehicles.

In the GM press release, Barra said the decisions were made to reflect consumer preferences and the changing market conditions. It also offered buyouts to thousands of workers earlier this year.

GM has yet to say how many workers accepted buyouts, or if it's close to meeting the staff reduction goals it set to better withstand leaner times.

The company also said the plan would make the company more efficient, saving it $6 billion a year by the end of 2020. The automaker in June ended the second shift at its factory in Lordstown, Ohio, cutting 1,500 workers.

While industry-wide passenger auto sales were down 13.2 percent through the first nine months of the year, pickup truck and SUV sales rose 8.3 percent.

In 2005, GM cut 3,750 jobs with the shutdown of the Oshawa No. 2 plant and the elimination of a shift at its other vehicle line.

GM did not immediately comment on Trump's remarks, but the company noted it has other facilities in OH including a transmission plant in Toledo and metal center in Parma.

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Unlike its plants making passenger cars, many of GM's plants producing its higher-margin trucks and SUVs are running on three shifts, with some running six and sometimes seven days a week to keep up wih demand. But the political atmosphere might limit realistic choices for the Detroit automaker. Barra is also shifting resources toward building electric cars and, eventually, vehicles that drive themselves. The once-bustling factory already has lost two of its three shifts and 3,000 union jobs since the beginning of a year ago.

In 2015, assembly of the Chevrolet Camaro in Oshawa ended and in 2016, assembly of both the Chevrolet Impala and Equinox came to an end. GM Chief Executive Officer Mary Barra is trying to make the company leaner as US auto demand slides from a record in 2016 and sales in China - GM's other profit centre - are also in a slump. In 2009 the government bailout for auto manufacturers established that 16 per cent of GM's manufacturing in North America was to be kept in Canada. If the Lordstown jobs are coming back, it's not happening soon.

And just three years ago, Oshawa took a hit when GM moved production of the Chevrolet Camaro to MI, slicing 1,000 jobs in Ontario.

"The expansion at Arlington will be completed next year, but there are major components that are already completed", Patrick Hernandez, GM spokesman in Arlington, said in an email.

Unifor Local 222 shop chairman Greg Moffat said Monday the plant is not closing "without the fight of our lives".

The plant of General Motors Canada has always been the key employer and economic driver of Oshawa.

A White House official said that Trump spoke with Barra on Sunday, before the closures were publicly announced.

Jennifer French, MPP for Oshawa, says she finds the report of the plant closure "gravely concerning".

GM to slash jobs and production as USA sedan sales sink