General Motors made a major announcement on Monday saying it will close two plants in metro Detroit as well as plants in Ohio and Canada. The plan will help save the company $6 billion by 2020, according to GM.
In a press release, the company said it will close the Detroit-Hamtramck Assembly Plant in Detroit and Warren Transmission Operations in Warren. Other plans closing include the Oshawa Assembly Plant in Oshawa, Ontario, the Lordstown Assembly in Warren, Ohio and the Baltimore Operations in White Marsh, Maryland.
According to a spokesperson for GM, the plants will be unallocated which means they will no longer produce vehicles in those plants in 2019. According to the company, the future of the plants will be part of contract talks with the UAW next year.
“The actions we are taking today continue our transformation to be highly agile, resilient and profitable, while giving us the flexibility to invest in the future,” said GM Chairman and CEO Mary Barra. “We recognize the need to stay in front of changing market conditions and customer preferences to position our company for long-term success.”
According to the release, GM will lay off 14,700 factory and white-collar workers. Of those, 8,100 will be white-collar workers that will either take buyouts or be laid off.
The company said that the moves will help continue its focus on crossovers, SUVs and trucks. With the move, GM plans to cut 25 percent of the executive staff and 15 percent of the salaried and salaried contract staff.
"These actions will increase the long-term profit and cash generation potential of the company and improve resilience through the cycle," Barra added in the release.
Detroit Mayor Mike Duggan called the news "troubling," saying he spoke with Barra on Monday morning and has also spoken with UAW President Gary Jones as well as Detroit's economic development team.
"We all know there is strong demand for manufacturing space in Detroit and we are willing to work with GM to fill all the available manufacturing space at Poletown with either GM-related entities or other companies," Duggan added.
Rep. Debbie Dingell, who represents Michigan's 12th Congressional District, is calling on Congress to "work on bipartisan policies that keep manufacturing jobs in this country," adding that she cares deeply for the families affected by the news.
According to General Motors, the restructuring will help the company focus more on the electric and autonomous vehicle programs over the next two years. Those focuses include expanding the use of virtual tools, integrating vehicle and propulsion engineering teams, increase component sharing and compress global product development campuses.