In a significant shift of strategy, General Motors is pressing pause on its electric vehicle production at Factory Zero due to slower demand. This adjustment will lead to a temporary layoff of workers, marking a critical moment for the Detroit automaker as it navigates the evolving electric vehicle landscape.
Factory Zero Shutdown
General Motors has announced the closure of Factory Zero until November 24, affecting approximately 3,200 workers. The factory, which resumed for a short period, will see about 1,200 employees placed on indefinite layoff come January 5. The facility, known for producing the GMC Hummer EV and other electric models, is a focal point in GM’s EV strategy.
The decision stems from GM’s October 14 strategic outline, where the company revealed that unused production equipment had resulted in $1.6 billion in costs. Consequently, the company is scaling back its EV production efforts temporarily.
Impact Beyond Detroit
Layoffs extend beyond Factory Zero. GM confirmed layoffs at its Ultium battery plants in Ohio and Tennessee, where operations will be paused from January until mid-2026. Approximately 700 employees in Spring Hill and 850 in Warren will face temporary layoffs, while 550 in Warren will be indefinitely laid off. Ultium Cells, a joint venture with LG Energy Solution, aims to upgrade facilities during this downtime to enhance flexibility.
Broader Workforce Impact
Factory Zero employs around 4,000 people, but GM has noted that 800 employees are not currently counted due to various reasons such as transfers or leaves. Additionally, recent layoffs have affected over 200 employees at GM’s Warren Technical Center and 300 at the Georgia IT Innovation Center.
According to GM spokesperson Kevin Kelly, “In response to slower near-term EV adoption and an evolving regulatory environment, General Motors is realigning EV capacity. Despite these changes, GM remains committed to our U.S. manufacturing footprint, and we believe our investments and dedication to flexible operations will make GM more resilient and capable of leading through change.”
Future Outlook
While the layoffs are a temporary measure, GM plans to resume operations by mid-2026, with upgrades aimed at adapting to market needs. During this period, affected employees may receive a significant portion of their regular wages, along with benefits.
For additional details, visit the official report on GM’s EV production investments.
Original Story at www.freep.com