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General Motors Laying Off Tennessee Workers

Automakers looking to head off glut of unsold vehicles.

by on May.17, 2017

General Motors is planning to layoff some workers at its Spring Hill, Tennessee, plant to avoid accusing a glut of unsold new vehicles.

With a substantial inventory of unsold vehicles sitting on dealer lots, General Motors continues to reduce production and idle workers at various assembly plants in an effort to trim vehicle stockpiles.

The news of new cuts at GM follow a confirmation by the Ford Motor Co. that it planned to reduce its salaried staff worldwide by 10%. Fiat Chrysler Automobiles announced plans for cutbacks but has idled workers in Sterling Heights, Michigan, and Toledo, Ohio, and Belvedere, Illinois, as part of a plan to renovate its production base in the U.S.

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Earlier, GM had announced that it would idle some 1,100 employees at plants in Lansing and is now reducing production of the Spring Hill Manufacturing facility, possibly triggering some 250 to 300 layoffs in the 4,100-member workforce.

GM operates 24 hours in Spring Hill, with three, eight-hour shifts producing the Cadillac XT5 and GMC Acadia. As recently as this year, many employees were working seven-day, 12-hour schedules.

(GM adding third shift at Tennessee plant. Click Here for the story.)

“We don’t know what the impact is going to be,” United Auto Workers 1853 Chairman Mike Herron said in an interview with a local newspaper in Spring Hill. “We have been told we will be having a line reduction, meaning we will have fewer cars coming through the assembly line than usual.”

“That’s the extraordinary thing about this business,” Herron said Sunday. “One minute, you’re working seven days a week, up to 12 hours a day, with all hands on deck. The next minute, it’s back to five days and 40 hours.”

Like other automakers, GM, which last fall launched a major renovation of the Spring Hill, is challenged by an environment where sales still look strong but are retreating after three consecutive record years.

(Click Here for details about GM’s plans to lay off 1,100 Michigan workers.)

At the same time, the level of incentives has been climbing as carmakers scramble to protect their market share.

“We plan to meet future demand for the Acadia and XT5 crossovers by continuing to run the plant on three shifts but plan to make a reduction to the line speed,” GM said in statement.

“We believe this will help maintain stable production, healthy inventory levels and provide the smallest impact to plant employment going forward. We’re not providing more detail about our plans or overall production strategy for competitive reasons,” the statement continued.

(To see more about GM idling five plants temporarily, including Lansing, Click Here.)

GM CEO Mary Barra said during a conference call with analyst that GM was keeping an eye on inventories but the company will continue to focus on profitable products. GM earnings jumped 35% to a record $2.6 billion in the first quarter of 2017.

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