It was announced that the automotive giant has made some adjustments at their plants in Michigan and Ohio. One of the changes involves investing nearly a billion dollars for new products at three of their plants. Along with the investment is a reduction of small cars. Two plants have been scheduled to eliminate a shift, at the beginning of next year. This is to help with excessive inventory.
In January, approximately two-thousand hourly workers will be permanently laid off from two of the company’s car plants. Part of the reduction has to do with a drop in small car sales. The layoff was announced on the same day as the investment in new products. GM plants, located in Lordstown, Ohio and Lansing, Michigan will lose their third shift in order to match the supply with demand. The Lordstown plant is where the Chevrolet Cruze is currently built. The third shift loss will cause more than 1,200 employees to lose their jobs. A little more than 800 employees will lose their jobs in Lansing, where the Chevrolet Camaro, Cadillac ATS and CTS are built.
Future of GM
The Detroit-based automaker believes that customers will continue to lean towards trucks and crossover vehicles, which caused them to reduce their production. This year, their sales had a sharp decrease for the four small vehicles, compared to their sales in 2015, during the same time of year. GM will also be investing $211 million into new equipment and tooling for their plant in Lansing, along with 32,000 square-feet of additional space that will be added to the current body shop. It is not known what car will be produced in the extended facility. The company also made investments in new products for their Toledo, Ohio plant ($667.6 million), which allowed them to retain 739 jobs and maintain a progressive production.