General Motors (GM) will fire 14,700 workers in North America and put five plants up for possible closure as it restructures to cut costs.
GM has said it will cut car production and stop building a number of slow-selling models. The company plans to halt production next year at three assembly plants - Lordstown, Ohio, Hamtramck, Michigan, and Oshawa, Ontario.
The news comes amid repeated claims from President Donald Trump that car and manufacturing jobs are returning to the US under his presidency.
GM also plans to stop building several models now assembled at those three plants, including the Chevrolet Cruze, the Cadillac CT6 and the Buick LaCrosse.
Also affected are transmission factories in Warren, Michigan, as well as Baltimore. GM will also close two factories outside North America, but did not identify those plants.
The United Auto Workers Union (UAW) has vowed to “confront this decision by GM through every legal, contractual and collective bargaining avenue open to our membership.”
“General Motors decision today to stop production at the Lordstown, Ohio, and Hamtramck, Michigan, assembly plants will idle thousands of workers, and will not go unchallenged by the UAW,” Terry Dittes, UAW Vice President in charge of negotiations with GM, said.
Canadian Prime Minister Justin Trudeau said he spoke with GM officials and expressed “deep disappointment.” Ontario Premier Doug Ford also expressed his displeasure at the move
Its North American engineering and executive workforce, will be cut by 15 per cent, or about 8,000 jobs. The company said it will cut executive ranks by 25 per cent to “streamline decision making.”
About 6,000 factory workers could lose jobs in the US and Canada, although some could transfer to truck plants.
The car manufacturer said it will shift more investment to electric and autonomous vehicles.
GM said the moves will save $6 billion in cash by the end of next year, including $4.5 billion in recurring annual cost reductions and a $1.5 billion reduction in capital spending.
Those cuts are in addition to $6.5 billion that the company has already announced by the end of this year.
GM doesn't foresee an economic downturn and is making the cuts “to get in front of it while the company is strong and while the economy is strong,” CEO Mary Barra said, explaining the move.
The factories up for possible closure are part of GM's effort “to right-size our capacity for the realities of the marketplace,” as consumers shift away from cars to trucks and SUVs, Ms Barra added
Agencies contributed to this report
