Most of the layoffs happened at GM's technical center, and most of those people worked on components for internal-combustion engines and discontinued car models. The average GM stock price target implies about 38% upside potential. The given video about GM Layoffs explains that one of the GMs Canadian plants at Oshawa, Ontario which produces Chevrolet Impala is the home for General Motors and it has been more than a decade the company is operating there (Feick, 2018). The cost-cutting drive comes after GM's announcement in January that it aims to save $2 billion in costs over the next two years. GMs layoffs start Monday, at least 4,000 expected to lose jobs. You can follow this link to learn about what cars GM is killing off. Notify me of follow-up comments by email. 2023 www.freep.com. We want to hear from you. Sign up for free newsletters and get more CNBC delivered to your inbox. On top of its EV push, General Motors is also working hard on developing its own EV battery platform, another likely growth catalyst on the road ahead. General Motors Co. has laid off 500 executive-level and salaried employees just a month after its CEO said the company was "not planning layoffs" amid major job cuts across the automotive industry. We want to hear from you. US government wants chip makers to share profits in return for subsidies, Vaccine maker Novavax says substantial doubt on ability to stay in business, China's February manufacturing activity sees fastest growth in over a decade. GM had alreadyhired 7,000 new salaried workersthis year, saidspokeswoman Maria Raynal. (2011, May 17). All rights reserved. GM said it incurred special charges in the fourth quarter of $511 million related to a buyout program for its Buick dealers and $657 million related to shuttering its limited operation in Russia. GM Layoffs: General Motors to Cut 14,000+ Jobs Source: Shutterstock According to General Motors (NYSE: GM) it is planning to lay off 15% of its salaried and He said GM is being "appropriately cautious" but vehicle inventories remain constrained amid strong demand. Copyright 2023 IBTimes LLC. I believe it is completely ok for a company trying to adapt to the changing market conditions and planning to produce vehicles that are preferred by the customers considering the long term sustainability of the company. Sign up for free newsletters and get more CNBC delivered to your inbox, Get this delivered to your inbox, and more info about our products and services., 2023 CNBC LLC. Copyright GM notes that the major changes to its plants structure and employee headcount has to do with the preference from customers. As of December 2022, GM had about 86,000 hourly employees and 81,000 salaried employees worldwide. On the date of publication, Samuel OBrientdid not have (either directly or indirectly) any positions in the securities mentioned in this article. The Company took this strategic decision in order to cope with the changing environment, deliver all those commitments, and improve customer service by meeting the needs of the players. This round of job cuts shouldn't worry GM investors, Source: Jonathan Weiss / Shutterstock.com, One of Motor Citys most iconic names is joining the growing list of companies laying off workers. "There are growing concerns about the economy to be sure," Barra said last quarter. A "significant" portion of the cuts will be in Michigan, Ford spokesman Mark Truby said. The 500 job cutsmake upless than 1% of GM's salaried workforce. General Motors' fourth-quarter results easily topped a year earlier. The livelihood of the North-American workers seems to be affected drastically (Lau, 2018). In July, GM reported its second quarter income was about 39% lower than the year-ago periodas ongoing production disruptions persisted due to supply chain issues andan industry-wideglobal semiconductor chip shortage. https://www.freep.com/story/money/cars/general-motors/2019/02/05/gm-layoffs-severance-pay/2778167002/, Feb 5, 2019 GM was in the second day Tuesday of massive salaried job cuts across its North American offices, targeting about 4,000 workers as part of a , Messages relating to layoffs at General Motors are presented below the company info. The 500 job cuts make up less than 1% of GMs salaried workforce. At that time, GM told the Free Press, the company was ahead of schedule in its hiring. GM feels they need to optimize themselves as per the change in market conditions and preferences of the customers in order to position themselves in the long-run. "We continue to shift resources to EVs, with around 75% of our product-specific capital dedicated to EVs and AVs," GM CFO Paul Jacobson said on Jan. 31, as quoted by the same outlet. Two Wall Street Legends will reveal their #1 recommendations and full "roadmap" for navigating the coming AI revolution. Now, the General Motors layoffs are looming and may lead to further uncertainty from investors, making it harder for the stock to rally in the short term. (2018, November 27). 10 Triple-A Stocks to Buy for the Rest of 2018, 5 Market-Beating Stocks for Low-Risk Investors. It was the stock's best daily performance since Oct. 4. Changes in these assumptions may have a material impact on the backtested returns presented. GM's full-year 2022 revenue came in at $156.7 billion, with net income attributable to stockholders of $9.9 billion and adjusted earnings before interest and tax at a record $14.5 billion. There has been a growing trend in the automotive industry towards cost-cutting measures and streamlining operations. Retrieved from https://www.cbsnews.com/news/gm-layoff-announcement-sparks-controversy/, Essays, U. Electronic Arts, which is considered as one of the leading American Video Game Company around the world plans to cut 350 of its employees in the marketing, publishing, and other areas which includes closing offices in Japan and Russia (Schreier, 2019). GM also announced Tuesday an equity investment of $650 millioninLithium Americas Corp. to develop a lithium mine in Nevada known as Thacker Pass. GM and other manufacturers' cost-cutting initiatives aim to improve their competitiveness and financial performance in light of difficult market conditions. The area around the plant is designed in such a way that the shutting down of the GM plant will affect the entire city. GM earned a record $14.5 billion for 2022, according to its CEO General Motors Co. has laid off 500 executive-level and salaried employees just a month after its The Company wants to adopt a new international strategy for serving the players in those markets in a better way. Per The Detroit News: The move, delivered amid impressive profitability, signals the evolving impact of electrification on legacy automakers like GM. All Rights Reserved. Jacobson told investors last month that the company expected to reduce employee headcount through attrition rather than layoffs. The cutsstartedTuesday and will continue based onlocation. The timing of the cuts, which were first reported by The Detroit News, is odd. GM CEO Mary Barra, in a letter to shareholders, described 2023 as a "breakout year" for the company's electric vehicle business, highlighting the introduction of more mainstream products like the Chevrolet Equinox EV as well as increases in production of its current models. Last week, the automaker reinstated its dividend and said it would start doing stock buybacks. As per the notice, they have invoked section 25 of the Industrial Dispute Act, wherein no permission is needed. 1125 N. Charles St, Baltimore, MD 21201. GM beats expectations on top and bottom line. It is considered that GM didnt build Oshawa rather Oshawa built General Motors. All Rights Reserved. General Motors Announces Sweeping Layoffs for North American Workers, Personal Analysis of the decision taken by General Motors, Performance Appraisal at Bank of Kathmandu | Human Resource Management, Writers Block Overcoming Writers Block | Managerial Communication, Karmachari Sanchaya Kosh - | Employees Provident Fund Nepal, Key elements of Organizational Behavior - People, Structure ,Technology & External Environment | Organizational Behavior, Perceptual Errors -Types of Perceptual Error | Fundamentals of Organizational Behaviour, Types of Groups - Formal and Informal Group | Group Behavior and Team Development, Difference between Manufacturing and Service Operations | Operation Management, Maryland Warren Transmission Operation, Michigan. after saying earlier this year that it didnt plan layoffs. I believe it is completely ok for a company trying to adapt to the changing market conditions and planning to produce vehicles that are preferred by the customers considering the environmental factors. Wedbush Analyst Daniel Ives recently stated cost-cutting is part of this process, indicating that investors shouldnt be worried. General Motors Co. (NYSE: GM), one of the St. Louis region's largest employers, on Tuesday reported a strong fourth quarter and full-year 2022 earnings that outperformed expectations. "That's why we're already taking proactive steps to manage costs and cash flows, including reducing some discretionary spending and limiting hiring to critical needs and positions that support growth. "Yesterday's strategy cannot be used to win tomorrow," she said. The company aims to save $2 billion over the next two years by reducing overhead and corporate expenses, according to a Detroit News report. FOLLOW MORE IBT NEWS ON THE BELOW CHANNELS, IBT Fast Start - Let the best of International News come to you. I think for any organization whether its GM or others the first priority is always focusing on long term growth and sustainability of the Company. General Motors Co. (NYSE: GM) on Tuesday reported a strong fourth quarter and full-year 2022 earnings that outperformed expectations. She clarified that the company aims to According to General Motors (NYSE:GM) it is planning to lay off 15% of itssalaried and salaried contract staff. Stay up to date with our daily newsletter, Mercedes-Benz Cars To Have 'Supercomputers', Unveils Google Partnership, U.S. Manufacturers See Big Boost From Government Subsidies And Tax Breaks. EA Lays Off 350 People In Marketing, Publishing, And More. Backtested results are adjusted to reflect the reinvestment of dividends and other income and, except where otherwise indicated, are presented gross-of fees and do not include the effect of backtested transaction costs, management fees, performance fees or expenses, if applicable. By Poornima Gupta. When it reported 2022 Q4 earnings on Jan. 31, CEO Mary Barra stated, I do want to be clear that were not planning layoffs. Just over one month later, however, the The president promises that there will be auto jobs coming to the people around the places like Ohio where the massive layoffs by General Motors are taking place. No cash balance or cash flow is included in the calculation. In manufacturing, GM has hired more than 4,500 hourly workers in Michigan year-to-date, said Dan Flores, GM spokesman. Most investors dont have major gainers like TSLA or NVDA on their radar from the start. GM to lay off 4,250 salaried workers in North America starting Monday. This material may not be published, broadcast, rewritten, or redistributed. At the end of last year, GM employed about 86,000 hourly workers and 81,000 salaried employees worldwide. GM expects some head count reduction due to attrition but the company is "not planning layoffs," Jacobson said. Leading automaker General Motors (NYSE:GM) is eliminating hundreds of executive-level and salaried jobs globally to reduce costs. DETROIT (AP) There are more than 8,000 new technical job openings at General Motors, and the automaker plans to fill them during a hiring spree this year. I like our position, and I wouldn't trade it with anyone in our industry. Here's how GM performed to close out last year, compared with analysts' estimates as compiled by Refinitiv: The fourth-quarter results easily topped a year earlier, when the automaker reported an adjusted EPS of $1.35 and revenue of $33.58 billion for the final three months of 2021. The TipRanks Smart Score performance is based on backtested results. That includes taking out "significant cost" by 2020 as GM transformed the company. But GM is moving forward from a position of strength, Barra said. The video emphasizes that the blue color workers who built the cars for more than 100 years and supported the company as well as also helped in building America are affected by the layoffs in numerous ways. Its been more than a century that General Motors is operating its business with more than 180,000 employees serving around six continents in the world. https://www.cnbc.com/2019/02/01/gm-readies-to-make-4000-involuntary-layoffs-next Company information: Industry/Area of Activity: Autos & Auto Parts; Company , https://www.forbes.com/sites/stephaniedenning/2018/11/29/why-the-general-motors-layoffs-were-strategic/, Nov 29, 2018 Smallish-Scale Layoffs : By most benchmarks, cutting 14,000 employees is a large-scale layoff . WebHome. Wall Streets Moderate Buy consensus rating for General Motors is based on seven Buys and four Holds. As of December 2022, GM employed about 86,000 hourly employees and 81,000 salaried employees worldwide. Further, the video highlights that the Company wants to shift toward future-forward technology with a leaner and profitable business. Watch: US: General Motors on cost-cutting drive, cuts hundreds of jobs | World Business News. Mary Barra, CEO, GM at the NYSE, November 17, 2022. GM stock will likely shake off the impact of layoffs and continue growing as the market rebounds. What GMs Layoffs Tell Us About Disruption in the Automotive Sector. In an interview with Bloomberg last month, CFO Paul Jacobson said, "We went through a fairly big restructuring back in 2018 in which the company, prior to my arrival, did an amazing job of saving $4 billion to $4.5 billion annually and paving the way for the investments that we need to make in the cost structure to produce EVs.". The logo of General Motors is seen in a file photo. Those numbers should help put the news in context, though. General Motors on Tuesday reported solid fourth-quarter and record year-end financial results, despite being plagued with production disruptions for much of 2021. January 26, 2022 / 3:35 PM / CW50 Detroit DETROIT (AP) There are more than 8,000 new technical job openings at General Motors, and the automaker Data is a real-time snapshot *Data is delayed at least 15 minutes. The decision of sweeping GM Layoffs didnt affect the stock price of the GM as it was presented in the video which is actually dependent on the customer buying behavior and how the customer feels the company is going to perform in the nearby future. Listed below are the closing and layoff notices reported to the Virginia Workforce Networks Rapid Response program. Also, the tariff that has been imposed by the US president on steel and aluminum is costing automakers in America around the extra cost of billions of dollars which has created a big market shift. That is usually seen as a positive sign. "We think the underlying business is going to be pretty consistent with what we saw last year, and I think that's a slightly more bullish statement than where most of the market is," he said. A Division of NBCUniversal. You can now write for wionews.com and be a part of the community. Just over one month later, however, the auto giant has announced that it will be cutting roughly 500 salaried jobs, chiefly at the executive level. DETROIT General Motors handily beat Wall Street's top- and bottom-line expectations for the fourth quarter, while forecasting another solid year of results in 2023. That means that, while no layoffs loom in the near future, GM is "being prudent in limiting our hiring to critical skill sets," Raynal added. GM beats expectations on top and bottom line. The company has a "work appropriately" policy that gives employees flexibility to work where they want, when the work permits. Since trades have not actually been executed, results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity, and may not reflect the impact that certain economic or market factors may have had on the decision-making process. He is ranked in the top 15% of stock pickers on TipRanks. Ford reported second-quarter adjusted earnings of $3.7billion more than triple that of the same period a year ago,when the company had a gain of $1.1billion. The results come as the U.S. automotive industry is beginning to normalize after several years of record-low inventories. Barra confirmed GM's revised plans to produce 400,000 EVs in North America between 2022 and the first half of next year. She also stressed the importance of having the "winning team" to beat the competition and achieve the company's goals. One of Motor Citys most iconic names is joining the growing list of companies laying off workers. Sign up and stay up to date with our daily newsletter. More CNBC delivered to your inbox investors shouldnt be worried millioninLithium Americas Corp. to develop lithium... Drive, cuts hundreds of executive-level and salaried jobs globally to reduce costs that! Hourly workers and 81,000 salaried employees worldwide target implies about 38 % upside potential 7,000 salaried! Profitable business the average GM stock price target implies about 38 % upside potential these assumptions have! To work where they want, when the work permits reduce costs stock likely. Has been a growing trend in the top 15 % of GMs salaried workforce: GM on! To improve their competitiveness and financial performance in light of difficult market conditions off the impact of on... 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