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5 reasons why GM is cutting jobs, closing plants in a healthy economy

DETROIT — Even though unemployment is low, the economy is growing and U.S. auto sales are near historic highs, General Motors is cutting thousands of jobs in a major restructuring aimed at generating cash to spend on innovation. It's the new reality for automakers that are faced with the present cost of designing gas-powered cars and trucks that appeal to buyers now while at the same time preparing for a future world of electric and autonomous vehicles. GM announced Monday that it will cut as many as 14,000 workers in North America and put five plants up for possible closure as it abandons many of its car models and restructures to focus more on autonomous and electric vehicles. The reductions could amount to as much as 8 percent of GM's global workforce of 180,000 employees. The cuts mark GM's first major downsizing since shedding thousands of jobs in the Great Recession. The company also said it will stop operating two additional factories outside North America by the end of next year. The move to make GM get leaner before the next downturn likely will be followed by Ford Motor Co., which also has struggled to keep one foot in the present and another in an ambiguous future of new mobility. Ford has been slower to react, but says it will lay off an unspecified number of white-collar workers as it exits much of the car market in favor of trucks and SUVs, some of them powered by batteries. Here's a rundown of the reasons behind the cuts: Coding, not combustion CEO Mary Barra said as cars and trucks become more complex, GM will need more computer coders but fewer engineers who work on internal combustion engines. "The vehicle has become much more software-oriented" with millions of lines of code, she said. "We still need many technical resources in the company." Shedding sedans The restructuring also reflects changing North American auto markets as manufacturers continue to shift away from cars toward SUVs and trucks. In October, almost 65 percent of new vehicles sold in the U.S. were trucks or SUVs. That figure was about 50 percent cars just five years ago. GM is shedding cars largely because it doesn't make money on them, Citi analyst Itay Michaeli wrote in a note to investors. "We estimate sedans operate at a significant loss, hence the need for classic restructuring," he wrote. The reduction includes about 8,000 white-collar employees, or 15 percent of GM's North American white-collar workforce. Some will take buyouts while others will be laid off.

GM recalls nearly 24,000 Buick Regals for brake issue

Buick is recalling 2018-2020 model year Regals to address a software defect in the braking system that would result in a loss of power assist under certain circumstances, making the brakes difficult to operate and potentially leading to a crash. In total, 23,734 models are covered by the campaign. "In the event of a partial or full loss of vacuum-brake assist, the vehicle’s hydraulic-brake boost is designed to supply supplemental pressure to the vehicleÂ’s brake system. A software error in the electronic brake control module (EBCM) may fail to activate the hydraulic-brake boost under these conditions," GM said in its defect report to NHTSA. "If the vehicleÂ’s vacuum-power brake assist partially or fully fails, braking events may require additional stopping distance, depending on the brake pedal force applied by the driver. Increased stopping distances could increase the risk of a crash." GM says that a warning indicator will illuminate in the dash if the system completely fails, and drivers may notice an increase in brake pedal resistance. Failure will not render the brakes inoperable, but they will require more force to operate. GM has begun notifying dealers of the defect; owners should be notified starting in August.   Related video: Recalls Buick GM Safety Hatchback Wagon Sedan

The new Opel Insignia might be a great Buick, but it's a sad Holden Commodore

Since the first shots of the uncovered Opel Insignia hit our inboxes, we've been filled with excitement for the new sedan. It looks great, it should come to America with little to no visual changes as the Buick Regal, and we might even get a wagon version. Unfortunately, there's a lead lining to this silver cloud, and it comes to us from Down Under. You see, the Opel Insignia is also undergoing a re-badging job in Australia to become the new Holden Commodore. It's replacing the beloved rear-drive Commodore (with an optional V8 and ultra-high performance HSV variants) with a front-drive-based platform offering four- or six-cylinder engines. This is depressing news considering the Zeta-platform underpinning the Commodore VF spawned the Pontiac G8, Chevrolet SS, and fifth-generation Camaro. Knowing this was going to happen doesn't help much either. What makes it all worse is that the new Commodore doesn't have a shred of unique styling in the bodywork. That's not an exaggeration. A new grille with a Holden lion badge instead of an Opel lightning bolt badge is the only change. See for yourself in the Insignia gallery below. Not only did GM erase a unique Australian model, it didn't even allow the brand to give the car a distinct shape. It's sort of like when Ford planned to replace the Mustang with the Mazda-derived Probe. The Probe wasn't that bad for the time, but it was no Mustang. At least in that case the Mustang survived. View 12 Photos Before we get ourselves too down, we should mention that there are reasons to be hopeful for the future. For one thing, the new all-wheel-drive Commodore/Insignias will come with a version of the GKN-developed rear differential found in the Focus RS and Range Rover Evoque, which is pretty neat on its own. And Opel/Vauxhall have always had wild performance versions of the Insignia and its Vectra predecessor. The last one made 325-horsepower and had all-wheel-drive. A new one would likely produce much more, since one of the available V6s makes 308 horsepower. Then imagine all of that extra hypothetical horsepower hooked up to the all-wheel-drive system that introduced us to "drift mode." Not only that, but rear-drive Holdens may not be completely dead yet. A Belgian man announced his intention to buy an old Holden factory along with the tooling and rights for the car once it was discontinued. His plan is to continue producing the old model after Holden is done with it.