GM to Fire 1,500 Ohio Workers

Mike Mish Shedlock

Passenger car sales are slumping. In response automakers are laying off workers at sedan-producing factories.

General Motors Co. will fire as many as 1,500 workers at the end of June at the Ohio factory building the Chevrolet Cruze compact car, undercutting President Donald Trump’s bombast about bringing back auto jobs.

The Lordstown assembly plant will operate on only one shift as part of the cutback, spokeswoman Dayna Hart said in an email. The company will be roughly halving the workforce at the factory, though Hart wrote that it’ll remain open for the foreseeable future.

“Lordstown is among the few remaining builders of small cars in the U.S. and it is our plan to keep it that way,” she said. “GM recently stated our commitment to sedans and the role Cruze plays in that commitment.”

GM’s plans for its Ohio factory are the result of American consumers snubbing cars in favor of crossovers. Cruze sales plunged 26 percent in the first three months of the year to less than 40,000 units and slipped 2.2 percent last year. Automakers have been laying off workers in passenger-car plants as roomier sport utility vehicles have seized record share of industrywide deliveries.

Trump Statement

“We’re turning it around,” Trump said Thursday from the White House Rose Garden. “Already, Chrysler is coming back with auto plants. Many companies are now in Michigan, Ohio, different places, Pennsylvania. They’re building beautiful, brand new auto plants. Nobody thought they’d ever see that happen.”

Not quite. And although the love affair is with SUVs total sales have peaked.

Mike "Mish' Shedlock

Comments (19)
No. 1-19
Mike Mish Shedlock
Mike Mish Shedlock

Editor

I am in Arches National Park. Posts may be a bit more infrequent at times.

MissionAccomplished
MissionAccomplished

Lordstown assembly plant. That name always takes me back to
the 1971 Chevy Vega, the Motor Trend Car of the Year, also on everyone’s short list for Worst Car of All Time.

ipso_facto
ipso_facto

Imagine if the automakers were allowed to build cars the consumers actually wanted rather than the high MPH 'jelly beans' the government forces them to make instead.

shred1
shred1

No, AWC, it was the unions killed Detroit.

channelstuffing
channelstuffing

fed should step in,nothing must be allowed to correct to market forces (ever),simply they should do for auto's what they're doin for stock,bonds,oil, gold (well everything) and simply print up a few tril and start buyin chevy cruz's in bulk right of dealer lot's,what could possibly go wrong with that!!

Carl_R
Carl_R

So long as we continue to see a tariff on steel, I expect more of this. American car makers will have to raise prices, but foreign makers can lower theirs, as there will be a shortage of low cost steel in the US, and an abundance of it elsewhere.
American market makers once had a >90% share of the American market, but unfortunately their cars where inferior, and unreliable. That allowed foreign makers to steadily grow market share. There's not really any reason to even debate the point of whether it was a product mix issue that "killed" Detroit. If it was, there wold be millions of people in a waiting list to buy SUVs, and none available, but that isn't the case. People buy the car the like best.

wootendw
wootendw

"...automakers are laying off workers at sedan-producing factories..." If you think about it, a sedan (or hardtop) is a bad idea. The space above the trunk is wasted when it could be used for people or to carry things. A station wagon or SUV might weigh a little more but there is little to no loss in terms of wind resistance. Perhaps car buyers are finally realizing this.

Sechel
Sechel

most likely a sub-prime auto issue. these cars strike me as the kind most likely fueled by b/c lending and subprime financing has been drying up lately.

Blacklisted
Blacklisted

There is no difference between unions and the govt, just as there is no difference between Republicans and Democrats.

Blacklisted
Blacklisted

Instead of competing, it's much easier to destroy the competition, which is why big corportions support WMD (We Must Destroy) the competition. Domestically, it's done through establishing monopolies by buying-off politicians that impose onerous laws on small businesses. It also doesn't hurt when the paid-off establishment refuses to enforce existing anti-trust laws or force transparency. When the abuses get to obvious they can't be ignored, the govt collects their kickbacks in the form of cost-of-doing business fines. This racket has served the industrial complexes in health care, banking, and the military quite nicely. Why would it not work in the auto industry?

Internationally, when the "Economic Hitment" are not effective, and foreign leaders don't go along with the economic asset stripping, it's simply easier to send in the military and kill the competition, and hope the blowback (consequences) can be blamed on a false flag committed by a foreign boogeyman. You can read the books of John Perkins, who was an Economic Hitman, to learn the details of how the game has been played for decades.

Trump caved to the Military Industrial Complex on Syria, because he didn't want to end up like JFK. The consequences of killing our international competition (i.e. Russian gas) will be devastating. The consequences of protecting big auto and big pharma have been devastating for workers and consumers.

PeterEV
PeterEV

I used to be able to tell when I flew into the :LA Basin, my eyes would start to water. How could anyone live in this air? Well they can tolerate it and the asthmatics know that the air is lousy. Fast forward to Exxon Mobil's View to 2040 where there is a graph that depicts the peaking of world oil production in the 2040 to 2050 time frame. We have to address the problems of air pollution and reliance on fossil fuels. I think EVs are a possible solution. If not and you are young enough, the "Jelly Bean" cars might fit your budget in the later half of this century.

RonJ
RonJ

"Trump caved to the Military Industrial Complex on Syria, because he didn't want to end up like JFK." Oswald was working for himself. Obama didn't invade Syria and completed two terms.

MudB
MudB

You can make business climate favorable for automakers. Its up to them to make a care someone wants........duh. I watched the auto industry demise from early 70s, thru 80s, 90s, to present. When I still say I wouldnt consider an american made car...its because I wouldnt ...consider...an ...american....made...car.

Trucks...different story. And only because repair of Toyota is prohibitively expensive long term.

Sechel
Sechel

No, he did not Trump caved to images he saw on TV. The truth is that Trump responds on gut feel. There is no Trump doctrine and for some reason the images about Syria hit Trump in his gut

stillCJ
stillCJ

Editor

Not only Detroit: US regs killed off imports of many sports cars, which put them out of business (Austin-Healey for example).

KidHorn
KidHorn

I think this has more to do with the Chevy Cruz being a crappy car than any statement about the US auto industry.


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