GM Prepares to cut 14,000 Jobs


On the Monday after Thanksgiving, General Motors (GM) announced in a written statement that they would be closing five plants and cutting 14,000 jobs. Included in the proposal for cuts are plants in Ohio, Michigan, Maryland, and Ontario. GM reports they will be cutting salaried positions by a total of 15% and has plans to end production of a plant in Gundan, Korea.

GM Protects their Profits

GM made this decision in spite of receiving enormous tax cuts passed by the Republicans and approved by the Trump administration, and after being given $51 billion in bailout money by the U.S. government in 2008 as a part of the corporate bailout during the Great Recession. GM reports this shift will help them as they move away from making smaller cars and focus on autonomous vehicle, or driverless car, production.

Trump’s tariffs on steel, which have been in effect since March, have added $1 billion to GM’s costs. Despite the tariffs, GM and Ford have been able to turn a profit but the tariffs are still pushing them to look at moving production. China’s market has been a factor as well since GM is now selling more vehicles there than in the U.S.

At first glance, some will call this a smart business move and blame a lack of buyers for smaller vehicles in the U.S. In truth, GM has thrown in the towel, giving up on being a competitive small vehicle maker and is searching for a path to squeeze profits out of its current infrastructure. Furthermore, GM spent $10.6 billion buying back its stocks in the past few years instead of investing in the company. This plan is more about protecting corporate profits than becoming a sustainable automaker.

For decades, U.S. automakers were on top as the best selling vehicles in the U.S. until the rise and arrival of Japanese automakers. GM, Ford, and Chrysler, formerly known as “The Big Three,” have not been able to keep pace with research and development investment as much as their Japanese and German competitors. In the U.S., Japanese automakers have also been able to pay their workers less because they are not unionized. As a result, GM wants to move jobs away from union plants and look toward places like China and states in the South in the U.S. where they can pay workers less.

UAW Prepares a Fight Back

On December 3, the United Automobile Workers (UAW) wrote a statement of a  “formal objection to GM announcement.” At least 6,200 high paying union jobs are on the line which would be a huge blow to the already hurting “rust belt” of the nation. The UAW will need to build a fight back to stop the cuts by GM.

One of the factories on the chopping block is in Lordstown, Ohio where the Chevy Cruze is built. UAW Local 1112 in Lordstown has already received multiple cuts to their workforce. GM eliminated the 2nd and 3rd shifts and moved production of the Chevy Blazer to Mexico just in the past year. Cutting shifts over a long period of time has put the UAW in a weak position with less workers to take this fight further.

In response, on November 19, the Youngstown/Warren Regional Chamber of Commerce and the UAW Local 1112 launched the “Drive it Home” campaign which is a broad coalition to show opposition for GM’s decision. There are no formal plans for how  to respond if GM continues with its decision to close the plant.

The UAW wants to use the plants that are slated to be closed to produce a new vehicle. Instead of closing these plants, GM could use these factories to build the driverless vehicles they want to build in the future. Also, GM could utilize these plants to return vehicle production back to the U.S. and build their better selling SUVs and trucks. In order to address the issue of climate change, factories can be converted to build affordable green vehicles like electric cars. The truth is GM does not want to pay union wages and are looking for places they can get away paying workers less. This move by GM is a way to send a strong message to the UAW before they go into negotiations in 2019.

The UAW needs to stand up to this corporate bullying in a major way. The UAW has announced it has $760 million in their strike fund that they are ready to use. Right now, they could use those funds to build community demonstrations against moving crucial jobs away, participate in work-to-rule days, assemble actions and start preparing members and the community for the possibility of a strike around contract negotiations that are due to expire in 2019. It will take bold leadership in this moment to turn the tide back to the workers.

Fight for a Democratic Workplace

In spite of soaring profits, both Ford and GM are laying off thousands of workers. Ford has yet to announce how many will be laid off but estimates could reach up to 25,000 workers globally. This will have a profound effect on the local and regional economies of the areas where these factories are based.

For the workers facing these layoffs the first question they will ask is, “What can be done?” We need a fightback that calls into question the system that created this crisis. CEOs like Mary Barra of GM do not make decisions based on what is best for the people but based on what maximizes profits. This logic promoted by capitalism puts profits over people. If GM cannot run these factories profitably, the workers should take them under democratic control and revamp them to build public transportation and keep good union jobs in the communities.

While wages have remained virtually stagnant, the 1% has massively increased their wealth. U.S. workers in all sectors are facing pressure to increase production while still being paid low wages. This is a tinderbox for explosive worker movements in the upcoming period. It will be the willingness of working people to fight back together using increasingly escalating tactics against the big business profit motive that can save our jobs and communities when faced with further cuts.