US GM Cuts Jobs Again "Hundreds of Contract Workers Left"

General Motors (GM) in the United States has carried out additional layoffs as part of cost-cutting measures in preparation for an economic downturn, the Wall Street Journal (WSJ) reported on the 1st (local time).

According to the report, hundreds of contract employees in GM's product development division left the company over the past weekend. A GM spokesperson confirmed the layoffs but did not disclose the exact number of employees affected.

The layoffs included contract engineers and designers responsible for new vehicle development. Approximately 20,000 contract and full-time employees belong to GM's product development division.

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This is the second round of layoffs by GM this year. Earlier last month, about 5,000 employees applied for voluntary retirement under a program targeting full-time staff. The company stated that the one-time costs associated with the voluntary retirement program were reflected in the first quarter results.

Although supply chain disruptions have largely been resolved, the WSJ interpreted that GM is taking preemptive layoffs to respond to pressures on new vehicle demand caused by inflation and high interest rates, which are weighing heavily on the finished vehicle industry.

GM, which experienced its worst year ever last year due to worsening business conditions such as semiconductor shortages and rising raw material prices caused by the Russia-Ukraine war, achieved double-digit sales growth in the first quarter of this year. According to GM, strong demand for pickup trucks contributed to a 17.6% increase in new vehicle sales in the U.S. in the first quarter compared to the same period last year.

Since the COVID-19 pandemic, GM has been streamlining management by withdrawing production lines worldwide and reorganizing its workforce to focus on emerging markets such as electric vehicles and autonomous vehicles, which are still in the early stages of market development, alongside the global supply chain restructuring.

Local media in Detroit, where GM's headquarters is located, cited industry insiders and experts saying that the scale of layoffs in the finished vehicle industry is expected to increase further over the coming months and years.

Aden Hoffman, GM's Chief Human Resources Officer (CHO), stated in a memo to employees on the 1st of last month, "In an environment where competitors' margins are improving, it is essential to focus on our own efficiency," adding, "We will pursue cost reduction, reduction of excess workforce, and product simplification."

This content was produced with the assistance of AI translation services.