President Donald Trump said the White House was looking at cutting federal subsidies for General Motors after the largest US automaker said it would halt production at five plants in North America and lay off thousands of workers. The president said that he was "very tough" with GM CEO Mary Barra when speaking with her after the announcement. Now, GM says the Cruze will no longer be sold in the US and production will end March 1. Among the possibilities are the Detroit/Hamtramck assembly plant, which makes the Buick LaCrosse, the Chevrolet Impala and Volt, and the Cadillac CT6, all slow-selling cars.
Meanwhile, it's a fallacy to suggest that the new deal could have either prevented or ended up expediting the cuts, said Dan Ujczo, an OH trade lawyer who hails from Lordstown, the same community outside Cleveland that's home to one of the five GM plants where production is to cease next year.
GM doesn't foresee an economic downturn and is making the cuts "to get in front of it while the company is strong and while the economy is strong", Barra told reporters.
Regardless, Trump went on to say "General Motors made a big China bet years ago when they built plants there (and in Mexico) - [I] don't think that bet is going to pay off". Some 75 percent of its global sales will come from just five vehicle architectures by the early 2020s.
General Motors benefits from a federal tax credit for electric vehicles, but the programme phases out after a manufacturer sells 200,000 cars. "So far President Trump has been asleep at the switch and owes this community an explanation", Ryan said Monday. They will also close two unnamed factories outside North America.
As recently as 2012, passenger cars made up more than 50 percent of all USA new vehicle sales.
GM will shutter at least three production plants, Oshawa Assembly in Canada, Lordstown Assembly in OH, and Detroit-Hamtramck Assembly in MI.
GM's stock price surged on the heels of the announcement, closing at 37.65, up almost 5 percent on the day. The company, calling the move a response to "changing market conditions", said it would get rid of more than 6,000 production jobs and another 8,000 salaried positions.
The United Auto Workers, which represents USA workers, vowed to fight the cuts.
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But those expansions aren't enough to accommodate all of the roughly 3,300 USA factory workers who could lose their jobs.
GM also is ramping up hiring at its GM Cruise autonomous vehicle unit, pushing to overcome technical challenges and make good on a plan to launch a robo-taxi service next year. "I spoke with her and I said, 'This country has done a lot for General Motors - you'd better get back in there soon.' That's Ohio".
Trump has long promised to return manufacturing jobs to the United States and particularly the Midwest.
Stefan Kooths, economics expert at the Kieler Institute, claims that the White House's protectionist policies are starting to harm the American economy. Some UAW workers could land jobs at other GM factories, but many will face uncertain futures unless GM reverses course.
GM said it would phase out certain models of slower-selling cars, halting production at four factories in the U.S. and one in Canada.
"We are right-sizing capacity for the realities of the marketplace", Barra said.
Five GM vehicle plants are operating at 37 percent capacity, according to the Center for Automotive Research. In all, six vehicle models were scrapped, leaving the company with nine remaining auto models.
GM sold its South African commercial-vehicle manufacturing plant and other operations to Isuzu Motors in 2017 and phased out its Chevrolet brand there.
Since it was introduced, battery technology has improved dramatically.
Ms Keller added that boosting electric-car output will be important for the Chinese market.