Lower demand for electric vehicles like the Hummer EV and Chevrolet Silverado EV is forcing GM to cut production at its large Factory Zero plant in Detroit, costing 200 jobs.
General Motors (GM) is facing challenges in the electric car market. The company will temporarily lay off 200 employees.
This is happening at the group's Factory Zero facility in Detroit, which exclusively produces electric vehicles. The factory builds models such as the Hummer EV as an SUV and pickup, the Chevrolet Silverado EV, the GMC Sierra EV and the Cadillac Escalade IQ.
The layoffs affect a small portion of the 4,500 employees at the plant. A GM source explains that the decision is not due to tariffs. Rather, it is about adjusting production. GM is adjusting demand in the electric car market.
Interest in electric cars is growing every year. But the growth is not happening as quickly as many car manufacturers had expected and had been promised by politicians. Especially outside of China and Norway, buyer acceptance is lower than predicted.
This is reported by US News .
This has led several manufacturers to reconsider their plans. Some will continue to produce cars with combustion engines during a transition period, while adjusting their original ambitions for an all-electric future.
The automotive industry is generally experiencing a period of uncertainty. Tariffs play a role for some, but declining demand for electric cars is also a significant factor for many.
Production adaptation at General Motors
Factory Zero in Detroit will now slow production. Demand for the large electric models has not met GM's expectations. The factory is focusing exclusively on electric vehicles.
The facility was previously known as the Detroit-Hamtramck plant until 2020, when GM decided to transform it into a state-of-the-art center for electric vehicles, basing the new production on its Ultium platform.
GM invested a large amount in the rebuild. A total of 2.2 billion dollars was spent. This corresponds to about 15.18 billion Danish kroner.
At the time, it was a record-breaking investment. GM itself called it "the single largest investment in a factory in GM's history." The conversion was intended to secure the future of electric vehicle production.
The plant officially reopened on November 17, 2021. U.S. President Joe Biden attended the opening ceremony. He was there with General Motors management and plant workers to mark the milestone.
GM's billion-dollar investment and future plans
At the opening, GM Chairman and CEO Mary Barra spoke.
"GM's American manufacturing expertise is key to achieving our all-electric future," she says.
"It's a monumental day for the entire GM team."
– We rebuilt Factory ZERO with the best, most advanced technology in the world to build the highest quality electric vehicles for our customers.
Gerald Johnson, executive vice president of Global Manufacturing and Sustainability, shares those visions.
– To meet our ambitious electric vehicle transition, GM's North American capacity will be increased by 20 percent by 2025, he explains.
– And then 50 percent by 2030.
Those goals now appear to be at a more ambitious level than GM has been able to meet.
However, it is a challenge that many major car manufacturers face. The exception is primarily the Chinese car brands, which are experiencing a different market dynamic. Some have even had to hire 200,000 new people in 3 months just to keep up. Read more here .
