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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.

2017 Chevy Camaro 1LE is the one you want

I'll admit, I'm not really a fan of the Camaro. It's a little too, "Come at me, bro." But if I had to drive one, it'd be the 1LE. In the Camaro's last generation, the 1LE was (arguably) the one to get – plenty of creature comforts inside, a track-focused suspension that wouldn't kill you during daily driving, and naturally aspirated V8 power. Even for me, the non-Camaro guy, it was a pretty nice ride (you just couldn't see out of it). View 14 Photos The new 1LE doesn't change that formula too much, but should be way better to drive, considering all the improvements Chevy made to the sixth-generation Camaro. The biggest update is that you can now get it with V6 power. Yes, the 6.2-liter LT1 V8 is still available, but for people who don't need eight-cylinder thrust, the six-pot car offers plenty of oomph with 200 less pounds to lug around. Chevy says customers specifically asked for a V6 1LE, and it'll be watching sales closely. If things go well, there could even be a 2.0T 1LE. Maybe. Elsewhere, the 1LE receives aerodynamic upgrades to differentiate it from lesser Camaros, and it's now available with Chevy's Performance Data Recorder. Read all about it in our original post, here, or scroll down for Chevy's official press blast. View 7 Photos New 1LE Packages Elevates Camaro Track Capabilities Track package returns with more technology for V8 models, first time offered on V6 CHICAGO – The Chevrolet Camaro 1LE performance package returns for 2017, poised to set new benchmarks for attainable track performance. The package builds off the success of the previous-generation 1LE, offering increased handling and track performance. In response to customer demand, Chevrolet will offer two distinct 1LE packages, for both V6 and V8 models, each visually distinguished with a satin black hood, specific wheels and more. For the first time, the 1LE package will be available on Camaro 1LT or 2LT coupes equipped with the 3.6L V6. Featuring more aggressive suspension tuning, standard Brembo brakes and Goodyear Eagle F1 tires, the LT 1LE delivers an estimated 0.97G in cornering grip. Available Recaro seats will keep you planted through the corners, and an available Performance Data Recorder will allow you to view and share your track experience. The new 1LE package for Camaro 1SS models includes magnetic ride control, with a new FE4 suspension tuning and a new, segment-exclusive electronic limited slip differential (eLSD).

GM profits threatened by glut of pickups

Automotive News reports that General Motors may slash production or ramp up discounts in order to deal with an oversupply of pickup trucks. GM currently has more than double the standard supply of pickups, and the vehicles are threatening to dampen the automaker's profits for 2013. Typically, automakers try to sustain a 60- to 75-day supply of vehicles, but GM is currently loaded with a 139-day supply, as of last month. At the end of November, the automaker was sitting on 245,853 units.
The manufacturer says that it will adjust production accordingly before laying any incentives on the profitable pickups. Even so, there's some concern that the inventory swell could hurt the roll-out of the next-generation Chevrolet Silverado and GMC Sierra. GM actually began slowly stepping back production in August, but it's clear the company will take further action as it heads toward the end of the year and into the next. Analysts predict the automaker could reduce pickup manufacturing by nearly half in the first quarter of 2013.
That still may not be enough to keep GM from laying extra cash on the Silverado and GMC Sierra. While the company's incentive spending was down in November compared to the same month in 2011, both the Ram 1500 and Ford F-150 saw double-digit percentage increases in sales last month while the Silverado and Sierra numbers slid compared to a year prior. Incentive spending could help move more trucks and add some balance to the GM inventory surge.