General Motors (GM) announced Friday it would lay off nearly 1,000 salaried workers globally, sparking speculation about a shift in its operations due to underwhelming electric vehicle (EV) sales. Automotive expert Jan Griffiths, founder of Gravitas Detroit, believes this move indicates a strategic realignment, as GM and other automakers reassess their approach to the EV market.
“GM had quite a shift in strategy lately; as you know, they were all in on EVs, and when the EV demand didn’t come through as we all expected, they had to change the strategy, and now they’re looking at right-sizing their operations,” Griffiths said. She added that other automakers, including Stellantis, are also grappling with challenges. Stellantis’ U.S. sales dropped 20% last quarter, and dealer lots remain full of inventory, prompting concerns over production adjustments.
Further complicating the automotive landscape are potential Trump-era tariffs on vehicles and parts manufactured in China. Griffiths warned these tariffs could significantly disrupt supply chains and drive production costs higher. “We’re expecting these tariffs to be extremely high, probably higher than we’ve ever seen before, and that too will have a ripple effect through the automotive supply chain,” she noted.
Automakers, however, may already be preparing for such scenarios. Griffiths suggested that many companies have begun nearshoring or reshoring their supply chains to mitigate risks. “The question is also: will these tariff rates come in all at one time… or will it ramp over time? These are things we don’t know until the new administration gets into place,” she said.
The layoffs and broader industry uncertainties highlight the challenges automakers face as they navigate a volatile market, balancing EV ambitions with shifting demand and geopolitical pressures.
Source: CBS NEWS
