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5 reasons why GM is cutting jobs, closing plants in a healthy economy

DETROIT — Even though unemployment is low, the economy is growing and U.S. auto sales are near historic highs, General Motors is cutting thousands of jobs in a major restructuring aimed at generating cash to spend on innovation. It's the new reality for automakers that are faced with the present cost of designing gas-powered cars and trucks that appeal to buyers now while at the same time preparing for a future world of electric and autonomous vehicles. GM announced Monday that it will cut as many as 14,000 workers in North America and put five plants up for possible closure as it abandons many of its car models and restructures to focus more on autonomous and electric vehicles. The reductions could amount to as much as 8 percent of GM's global workforce of 180,000 employees. The cuts mark GM's first major downsizing since shedding thousands of jobs in the Great Recession. The company also said it will stop operating two additional factories outside North America by the end of next year. The move to make GM get leaner before the next downturn likely will be followed by Ford Motor Co., which also has struggled to keep one foot in the present and another in an ambiguous future of new mobility. Ford has been slower to react, but says it will lay off an unspecified number of white-collar workers as it exits much of the car market in favor of trucks and SUVs, some of them powered by batteries. Here's a rundown of the reasons behind the cuts: Coding, not combustion CEO Mary Barra said as cars and trucks become more complex, GM will need more computer coders but fewer engineers who work on internal combustion engines. "The vehicle has become much more software-oriented" with millions of lines of code, she said. "We still need many technical resources in the company." Shedding sedans The restructuring also reflects changing North American auto markets as manufacturers continue to shift away from cars toward SUVs and trucks. In October, almost 65 percent of new vehicles sold in the U.S. were trucks or SUVs. That figure was about 50 percent cars just five years ago. GM is shedding cars largely because it doesn't make money on them, Citi analyst Itay Michaeli wrote in a note to investors. "We estimate sedans operate at a significant loss, hence the need for classic restructuring," he wrote. The reduction includes about 8,000 white-collar employees, or 15 percent of GM's North American white-collar workforce. Some will take buyouts while others will be laid off.

GM dealers unhappy about pickup prices

The backlash is beginning. Following General Motors' price hike of the Chevrolet Silverado and GMC Sierra last week, dealers across the country are expressing their ire over increasing prices in the face of rebates and discounts on trucks from Ford and Ram.
Speaking to Automotive News, Sam Pilato, the general manager at Dimmitt Chevrolet in Clearwater, FL, Silverados are "selling very poorly." W. Carrol Smith, the president of Monument Chevrolet in the heart of truck country, Texas, said, "[GM's] position is that the vehicle stands on its own and it doesn't need a bigger rebate. That's not what the market is telling us."
According to AN, that's the general attitude amongst Chevy and GMC dealers across the country, where the twin pickups are getting butchered in sales by competitors offering up to $9,000 off their sticker prices. Part of the problem for GM is that its trucks are arriving on the market near the end of the current F-150's lifecycle, a fact that Ford has taken advantage of.

Engine block heater issues force GM to recall 324,226 diesel heavy duty trucks

General Motors has issued a recall on 324,226 diesel heavy duty trucks that could be susceptible to short circuits, and consequently, potential fire. The recall affects several models of heavy duty Chevrolet Silverados and GMC Sierras with optional engine block heaters. GM is recalling seven different truck models spread across three years. The recall affects the 2017-2019 Chevrolet Silverado 2500HD, 2017-2019 Silverado 3500HD, 2019 Silverado 4500HD, 2019 Silverado 5500HD, and 2019 Silverado 6500HD, plus the 2017-2019 GMC Sierra 2500HD and 2017-2019 Sierra 3500HD. Specifically, it includes these models with the 6.6-liter Duramax diesel engines and the optional engine block heater. The recall technically deals not with the engine block heater itself, but the way it is connected. According to NHTSA campaign No. 19V328000, the engine block heater cord or the terminals that link the cord to the heater could short circuit. A short circuit could potentially damage engine components and result in a fire. According to The Detroit News, 19 fires have been reported but nobody has been injured. GM has yet to figure out a fix, and thus has not yet released a notification schedule for affected customers. If you believe your vehicle is part of the recall, contact GM customer service at 1-586-596-1733 and use reference number N182206310.