General Motors Extends Summer Plant Shutdowns, Layoffs Likely to Follow
If your current employment involves building a sedan for a domestic automaker, there’s both good and bad news awaiting you. General Motors is extending summer breaks at certain assembly plants and there may be an opportunity for some workers to extend that time off indefinitely, resulting in the least welcome vacations imaginable.
Stagnating sales and a bloated inventory is forcing GM to lengthen its traditional two-week summer shutdown to as many as five weeks for two U.S. factories, according to union officials. The affected plants are Lordstown Assembly, located in Ohio, and Kansas City’s Fairfax Assembly. Lordstown assembles the Chevrolet Cruze while Fairfax is responsible for the midsize Malibu, which has had a horrendous 2017. The Malibu had plenty of company in the doldrums, too. Through May, U.S. car sales were down 11 percent while truck and SUV sales rose by nearly 5 percent, forcing automakers to play favorites.
Speaking to The Wall Street Journal, United Auto Workers Local 31 president Vicky Hale claimed the Kansas City plant could be idled for up to five weeks, with job cuts likely to follow. Robert Morales, president of the Lordstown union, said his factory will stop production for the last two weeks in June, followed by another three weeks in July.
“It’s just to align with market demand, that’s all,” he explained on Wednesday.
After seven years of relatively consistent growth, overall demand for vehicles is slowing. Total U.S. deliveries are down 2 percent for May and industry analysts are suggesting 2017 won’t surpass 17.2 million units. Any expectation of topping last year’s record 17.5 million deliveries is now unrealistic — even if there are jobs depending on high sales volume.
The Lordstown plant, which saw a third shift cut at the beginning of the year due to lowered demand, employs roughly 3,000 workers. The Fairfax plant has about 3,500 workers. Hopefully, those numbers are unchanged after next month.
[Image: General Motors]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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Short term shutdowns/ temporary lay offs, extended summer,and Christmas vacations are "facts of life" in automotive assembly operations. As an auto worker, you learn to live with it. Seven - eight week summer shutdowns were the norm, up to about the early 80's. When inventories/field stock numbers get too high, shutting down production is the most cost effective solution. Turning back line speed, and shift reduction is a longer term solution.... Temporary lay offs VS permanent layoff , is a win win, for all sides.
The Malibu. It's finally a decent car, at least when new, but after umpteen generations of garbage, it is hard to conceive of a name with less brand equity. They might as well call it the Yugo.