The Fallout: Asinine Suggestions and Legitimate Pain Greet GM's Announcement

Steph Willems
by Steph Willems

But first, some Cyber Monday deals…!

Just kidding. Hopefully we’ve seen the last of that, God willing.

It didn’t take long for the usual suspects north of the border to respond to General Motors’ looming plant closures with ridiculous “solutions” — nationalizing GM Canada, for example, no doubt with the goal of repeating the successes of British Leyland in the late 70s and early 80s. Who could doubt the profit-generating prowess of the public sector?

Elsewhere, fiery rhetoric from autoworkers’ unions greeted news of GM’s plan to shutter five plants in the U.S. and Canada. But without new product allocations, and with demand for traditional sedans sinking fast, there’s little hope of seeing these facilities return to their golden days.

CEO Mary Barra defended the plan to stop production at the plants and discontinue a raft of models next year, claiming the move, coupled with other cost-saving initiatives, would protect GM from an eventual economic downturn. It would also free up development cash now, rather than threaten its existence down the line.

“This is what we’re doing to transform the company. The industry is changing very rapidly,” Barra said in a news conference attended by The Wall Street Journal. “We think it’s appropriate to get in front of it while the business and the economy are strong.”

She added, “We don’t see anything specific on the horizon. This is about making sure GM is lean and agile to get in front and lead in autonomous and electric vehicles.”

In total, 14,800 GM employees might end up leaving the company under the current streamlining efforts. Some 8,000 of them would be in North America — a loss of 15 percent of the automaker’s North American salaried workforce — with the company accomplishing its goal through layoffs, retirements, or buyouts. For the consumer, the potential loss of Oshawa Assembly, Detroit-Hamtramck, and Lordstown Assembly, plus a Michigan and Maryland transmission plant, would mean pretty much the end of the GM car as we know it.

Built at the three aforementioned plants are the Chevrolet Cruze, Impala, and Volt, the Cadillac CT6 and XTS, and Buick LaCrosse. Barra said that the loss of production would lead to the discontinuation of the models in North America. Meanwhile, ther Chevrolet Sonic, built at Michigan’s Orion Assembly, is living on borrowed time, as is the tiny Spark, which hails from GM Korea. That leaves the Chevrolet Camaro, Corvette, and Malibu, the upcoming Cadillac CT5, and the current Buick Regal to satisfy traditional car buyers.

True, GM workers wouldn’t find themselves in this situation if consumer tastes hadn’t migrated to light trucks. Through the end of September, year-to-date sales of the XTS (a livery favorite) rose 15.9 percent, but it was nowhere but down for other models slated for execution. U.S. sales of the CT6 fell 10.6 percent, year to date, while the Cruze dropped 26.5 percent, the Impala 13.4 percent, and the Volt 13.7 percent. Buick’s full-size LaCrosse, which has shed buyers for years, completed the first three quarters of the year with 14.2 percent fewer sales.

According to the Associated Press, LaCrosse, Volt, and U.S.-market Cruze production will wrap up March 1st, 2019, with CT6 and Impala production ending June 1st. The Warren plant, maker of six-speed transmissions, would go dark on August 1st, with Baltimore’s plant ceasing work on April 1st.

While there’s a chance the plants might be put to a different future use, the products built within seem destined for the grave. In the U.S., United Auto Workers representatives called the move “callous,” vowing to fight the decision via legal, contractual, and collective bargaining means. North of the border, Unifor president Jerry Dias said he’ll be “very aggressive and very aggressive soon” on GM, with the Detroit Three autoworkers’ union claiming it plans to meet with Prime Minister Justin Trudeau.

What good that will do remains to be seen. Ontario Premier Doug Ford, after speaking to the head of GM Sunday, said “the ship has already left the dock.” Oshawa Assembly, which has produced vehicles since before Chevrolet was even part of GM, will turn out the lights at the end of the year.

[Images: General Motors]

Steph Willems
Steph Willems

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  • DonInYYC DonInYYC on Nov 27, 2018

    Oh oh, I have an idea....let's sell the plant to Hyundai. Worked well in Quebec in the seventies. What could possibly go wrong? The Pony was simply a generation ahead of its time.

  • DavesNotHere DavesNotHere on Nov 27, 2018

    There's Chevy's new ad campaign: Real People, Real Urinal Cakes™

  • 3-On-The-Tree I don’t think Toyotas going down.
  • ToolGuy Random thoughts (bulleted list because it should work on this page):• Carlos Tavares is a very smart individual.• I get the sense that the western hemisphere portion of Stellantis was even more messed up than he originally believed (I have no data), which is why the plan (old plan, original plan) has taken longer than expected (longer than I expected).• All the OEMs who have taken a serious look at what is happening with EVs in China have had to take a step back and reassess (oversimplification: they were thinking mostly business-as-usual with some tweaks here and there, and now realize they have bigger issues, much bigger, really big).• You (dear TTAC reader) aren't ready to hear this yet, but the EV thing is a tsunami (the thing has already done the thing, just hasn't reached you yet). I hesitate to even tell you, but it is the truth.
  • ToolGuy ¶ I have kicked around doing an engine rebuild at some point (I never have on an automobile); right now my interest level in that is pretty low, say 2/5.¶ It could be interesting to do an engine swap at some point (also haven't done that), call that 2/5 as well.¶ Building a kit car would be interesting but a big commitment, let's say 1/5 realistically.¶ Frame-up restoration, very little interest, 1/5.¶ I have repainted a vehicle (down to bare metal) and that was interesting/engaging (didn't have the right facilities, but made it work, sort of lol).¶ Taking a vehicle which I like where the ICE has given out and converting it to EV sounds engaging and appealing. Would not do it anytime soon, maybe 3 to 5 years out. Current interest level 4/5.¶ Building my own car (from scratch) would have some significant hurdles. Unless I started my own car company, which might involve other hurdles. 😉
  • Rover Sig "Value" is what people perceive as its worth. What is the worth or value of an EV somebody creates out of a used car? People value different things, but for a vehicle, people generally ascribe worth in terms of reliability, maintainability, safety, appearance and style, utility (payload, range, etc.), convenience, operating cost, projected life, support network, etc. "Value for money" means how much worth would people think it had compared to competing vehicles on the market, in other words, would it be a good deal to buy one, compared to other vehicles one could get? Consider what price you would have to ask for it, including the parts and labor you put into it, because that would affect the “for the money” part of the “value for money” calculation. An indicator of whether people think an EV-built-in-a-used-car would provide "value for money" is the current level of demand for used cars turned into EVs. Are there a lot of people looking for these on the market? Or would building one just be a hobby? Repairing an existing EV, bringing it back into spec, might create better value for the money. Although demand for EVs is reportedly down recently.
  • ToolGuy Those of you who aren't listening to the TTAC Podcast, you really don't know what you are missing.