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article imageA down market for passenger cars causes GM to cut 1,500 jobs

By Karen Graham     Apr 14, 2018 in Business
General Motors plans to cut a shift at its Lordstown Assembly plant in Ohio, cutting as many as 1,500 workers, in an apparent reflection of the downturn in the market for passenger cars.
General Motors confirmed Friday it would be cutting one of two shifts at its Lordstown Assembly plant, about 15 miles northwest of Youngstown, Ohio. The facility produces the Chevy Cruze sedan, reports the Detroit Free Press.
In an emailed statement, GM acknowledged the slump in the passenger car market was the reason to shut down the one shift. "As we look at the market for compact cars in 2018 and beyond, we believe a more stable operating approach to match market demand is a one-shift schedule. Consequently, we will suspend the second shift of production at Lordstown late in the second quarter of 2018."
The Lordstown plant cut out its third shift last year and saw “several weeks” of downtime in 2017 after the third shift was eliminated. The elimination of the second shift said to affect about 1,500 employees will take effect on June 18.
"A special attrition program and buy out are being offered. Due to that and other business needs, we won’t know the exact number of people impacted for several weeks. We will begin communicating with the impacted hourly and salaried employees next week and let them know what options are available," according to the emailed statement from the company.
The Chevrolet Cruze saw a 2.2 percent downturn in sales in 2017, while deliveries were down 26 percent at just under 40,000 deliveries through March this year, compared to the first quarter last year. Despite the announcement, GM still plans to sell about 150,000 Cruze sedans in 2018, about the same number it sold last year.
Market down for all small cars
The Cruze is not the only GM car with slumping sales. Impala sales were down 16 percent to a little over 14,000 in the first quarter of 2018, while sales of Sonics are down 22 percent to 5,983. Sales of the Chevy Camaro sports car dropped by 23 percent to 11,792.
Ford Motor Co., Fiat Chrysler, Toyota, and Honda are all having similar problems with their sedan sales as more consumers are drawn to crossovers, SUVs, and trucks. According to 24/7 Wall St., there are some rumors floating around that some auto manufacturers might even stop production of their weakest selling cars completely.
The automotive market bears watching over the next several months, as well as unemployment figures as auto manufacturers adjust to a slumping passenger car market.
More about General motors, Passenger Cars, crossovers and suvs, petroleum industry, Economy
 
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