General Motors announced Thursday it will “temporarily” cut about 200 workers from its Factory Zero assembly center in Detroit and Hamtramck as a result of lackluster electric vehicle sales.
About 4,537 work at the Factory Zero plant that produces the GMC Hummer EV, Sierra EV truck, Chevrolet Silverado EV truck, and Cadillac Escalade IQ EV SUV, according to Reuters.
“Factory ZERO will adjust production to align with market dynamics,” GM spokesman Kevin Kelly told The Detroit News, clarifying that the cuts are not related to tariffs. “Impacted employees will be placed on a temporary layoff and may be eligible for subpay and benefits in accordance with the GM-UAW national contract.”
GM has struggled to offload EVs despite doubling sales over the last year, as customers remain hesitant over a variety of issues, from higher price tags to concerns about charging and charging infrastructure, according to the news site.
An anonymous person familiar with production plans at GM told the Detroit Free Press most of the reductions at Factory Zero will impact employees who work in battery pack manufacturing, with no current plans for them to return.
The announced job cuts follow just days after GM announced it will cut production of its Cadillac XT6 SUV in Tennessee. The company also cut shifts at its Ramos Arizpe manufacturing plant in Mexico earlier this year, according to The News.
Last month, GM was forced to shut down its CAMI Assembly plant in Ontario that produces its BrightDrop electric commercial vans to deal with a glut of inventory piling up at the factory and in lots in Flint amid lagging sales.
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The shifting priorities in 2025 follow decisions last year aimed at navigating a volatile EV industry that has relied largely on taxpayer subsidies from state and federal governments.
In December, GM announced it is backing out of its joint venture with LG Energy Solution to construct an Ultium Cells battery plant near Lansing, leaving LG to fulfill a promise to create 1,360 jobs.
GM negotiated $120 million in taxpayer funded incentives with Gov. Gretchen Whitmer’s administration as part of the deal, and those funds have since shifted to LG.
The funding was part of a broader business incentive package, the largest in Michigan’s history at $666 million when it was inked in 2022, that also included $480 million for GM to retool its Orion Township assembly plant to produce all-electric pickups.
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While the state has paid out the entire grant, GM has postponed plans at its Orion Township plan by at least a year because of lower-than-anticipated EV sales.
The decision to ditch Ultium Cells followed just one month after GM laid off 1,000 employees, including 507 salaried and hourly employees at its Global Technology Center in Warren for the same reason.
GM and other EV producers in the U.S. are now reworking production plans as President Donald Trump works to nix his predecessor’s EV mandate, while imposing a 25% tariff on automobiles and parts from Canada and Mexico.
The former could result in less focus on producing EVs, while the latter could move what’s left to Michigan.
Trump’s auto tariffs are aimed at pressuring car manufacturers to produce vehicles in the U.S., which the president argues will create jobs and opportunities for Americans, particularly in states like Michigan that fuel the auto industry.
“This will continue to spur growth like you haven’t seen before,” Trump said. “We’ll effectively be charging a 25% tariff. But if you build your car in the United States, there is no tariff.”
The UAW suggests the tariffs could result in “thousands of good-paying blue collar auto jobs” flooding back to more than a dozen underutilized auto plans across multiple states. The economic impact “would be enormous and have a cascading effect throughout communities from Michigan to Tennessee,” according to a union statement.
“At Warren Truck Assembly Plant in Warren, Michigan, for example, over 1,000 autoworkers are laid off while the plant sits underutilized and $100,000 Stellantis trucks are built in Mexico for $3 an hour,” the statement read. “These layoffs were announced less than six months ago and could be undone. Those jobs could be brought back to Michigan immediately with well-designed auto tariffs.”
Other Michigan plants that could benefit include Ford Flat Rock Assembly, Ford Michigan Assembly in Wayne, GM Lansing Grand River, GM Factory Zero in Detroit and Hamtramck, and Stellantis Jefferson North Assembly in Detroit, according to Bridge Michigan.