1. On Monday, General Motors announced “that it planned to idle five factories in North America and cut several thousand blue-collar and salaried jobs in a bid to trim costs.”
2. This move, which is similar to a move made by Ford, was made because low gasoline prices, at least in part, have led to slowing sales and a shift in consumer tastes.
3. The 5 plants will stop production next year. This will result in a termination of 3,300 production jobs in the U.S. and an additional 3,000 in Canada. 8,000 other salaried staff will lose their jobs as well.
4. The closing plants include 1) Lordstown, Ohio, 2) Detroit-Hamtramck, 3) Oshawa, Ontario, Baltimore, Maryland, and 5) Warren, Michigan. These plants could resume function at some point “depending on the outcome of contract negotiations with the United Auto Workers union next year.”
6. In response, Mary Barra, the CEO of G.M, said, “We are taking this action now while the company and the economy are strong to keep ahead of changing market conditions.”
7. General Motors shares rose more than 7 percent after the announcement.