Stagnating Sales Leads GM to Warn of Layoffs at Michigan SUV Plant

Matt Posky
by Matt Posky
stagnating sales leads gm to warn of layoffs at michigan suv plant

Automakers are seeing diminished interest in product as market demand levels off after years of post-recession growth. While some analysts are heralding an industry-wide doomsday, others have cited this as an inevitable market ebb with no cause for alarm. Either way, domestic and foreign automakers have begun scaling back production efforts.

In the United States, Ford recently announced layoffs at its Ohio truck plant and General Motors may be following suit by eliminating 1,100 employees at the Delta Township Assembly Plant near Lansing, Michigan.

GM’s newest U.S. factory was already scheduled undergo retooling for the 2018 Chevrolet Traverse and Buick Enclave crossovers. However, when the plant reopens this June, there’s a good chance that third-shift employees won’t be returning.

According to The Detroit Bureau, General Motors issued an official warning to 1,100 workers about potential layoffs —confirming earlier claims that job cuts were forthcoming. While the exact number of employees impacted by the cut has yet to be finalized, a GM spokesperson suggested only about half would actually lose their jobs. Still, any job retention could be temporary if deliveries continue to slip. U.S. auto sales fell another 4.7 percent in April, continuing a decline in sales that began at the start of 2017.

The majority of those prospective cuts are expected to come from assembly lines that manufacture sedans, coupes, and convertibles. Traditional passenger cars only account for a third of the market now. Meanwhile, SUVs alone have gone from 28 percent of the market in 2006 to about 40 percent today.

“We don’t see it stopping,” said Mark LaNeve, the head of Ford Motor Co.’s sales, service and marketing division, adding that there will be significant shifts in production strategies, even if domestic car sales suddenly leveled off.

[Image: GM]

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  • Shaker Shaker on May 11, 2017

    I wonder how Envision sales are doing...

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    • NormSV650 NormSV650 on May 16, 2017

      @highdesertcat The discounts for the lower trims of the Buick Envision are up to $10,000 off msrp in the Midwest at certain Dealerships or about $26,000 for a well equipped, near-luxury ride.

  • Jeff S Jeff S on May 11, 2017

    How about the fact that there has been a sales boom in new vehicle sales for the past 7 years. Isn't it reasonable to assume after 7 years of a sales boom that the sales would go through a slump? Much of the boom in sales can be attributed to those delaying purchases of new vehicles during the 2008 Melt Down. Many of those who delayed purchases have already bought new vehicles. Also longer term loans, low or no interest loans by manufacturers, and more favorable leasing deals have kept sales booming. Also people keep their vehicles much longer than they did years ago. Vehicles are expensive for many who have not been fortunate enough to have jobs that have not kept up with the cost of living. Also vehicles last longer. There are still many underemployed workers, workers whose jobs have either been phased out due to automation or cheaper labor overseas, and those who work in industries that are either dying or becoming obsolete. Many of the jobs that are lost will never come back due to just more automation. There is a technology revolution that has made many types of work obsolete, but at the same time there are new positions requiring much higher skills that require education and training. Cleaner and less expensive natural gas is displacing coal and even in the coal industry many jobs have been automated. Even industries that have come back to the US from cheaper foreign labor markets are using more robots requiring less labor. Robots don't get sick, take vacations, or go on strike and you can depreciate them over their useful lives.

  • Damon Thomas Adding to the POSITIVES... It's a pretty fun car to mod
  • GregLocock Two adjacent states in Australia have different attitudes to roadworthy inspections. In NSW they are annual. In Victoria they only occur at change of ownership. As you'd expect this leads to many people in Vic keeping their old car.So if the worrywarts are correct Victoria's roads would be full of beaten up cars and so have a high accident rate compared with NSW. Oh well, the stats don't agree.
  • Lorenzo In Massachusetts, they used to require an inspection every 6 months, checking your brake lights, turn signals, horn, and headlight alignment, for two bucks.Now I get an "inspection" every two years in California, and all they check is the smog. MAYBE they notice the tire tread, squeaky brakes, or steering when they drive it into the bay, but all they check is the smog equipment and tailpipe emissions.For all they would know, the headlights, horn, and turn signals might not work, and the car has a "speed wobble" at 45 mph. AFAIK, they don't even check EVs.
  • Not Tire shop mechanic tugging on my wheel after I complained of grinding noise didn’t catch that the ball joint was failing. Subsequently failed to prevent the catastrophic failure of the ball joint and separation of the steering knuckle from the car! I’ve never lived in a state that required annual inspection, but can’t say that having the requirement has any bearing on improving safety given my experience with mechanics…
  • Mike978 Wow 700 days even with the recent car shortages.