General Motors has announced that it will be placing 1,300 employees on a temporary layoff as it idles production at an electric vehicle plant in Detroit due to low demand for electric vehicles, a trend that several manufacturers are reporting, which raises the question of whether EVs are the future.
With dwindling sales figures of EVs, several automakers have shifted focus to hybrid and gas-powered cars, and now, GM seems to be feeling the heat. According to a report by Automotive News, GM is working on increasing production of internal combustion vehicles in accordance with the market demand.
The Detroit plant in question produces the Cadillac Escalade electric SUV, Sierra electric pickup trucks, GMC Hummer electric SUV and pickup, and the Chevy Silverado electric pickup truck.
The temporary layoff arrives months after a mass layoff in January that reduced production to a single shift. Notably, the plant idled from October 27 to November 24 last year.
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According to the United Auto Workers (UAW), the 1,300 affected employees were laid off on March 16 and will likely return on April 13. Addressing the layoffs, GM spokesman Kevin Kelly told Crain’s Detroit Business, an affiliate of Automotive News:
“Factory Zero will temporarily adjust production to align EV production with market demand. Impacted employees will be placed on a temporary layoff and may be eligible for subpay and benefits in accordance with the GM-UAW national contract.”
Factory Zero, an all-electric production setup, was established in 2021 after GM invested a whopping $2.2 billion to retool the former Detroit-Hamtramck Assembly plant.
With gas-powered vehicles now becoming the priority, the American automaker is working on retooling the Orion Assembly plant, located just 30 miles north, in a shift away from electrification that will see gasoline-powered pickups and Escalades being assembled there.
UAW Local 22 President James Cotton seemed upset about the EV market trend, as government EV policies are rolled back, putting the jobs of many working at Factory Zero at risk. He said:
“I never feel great about any layoffs, but sometimes market demand may impede production. I am happy my members will be returning to work.”
Despite the drop in demand for EVs, Cotton believes EVs are the future. He added:
“I just hope we can bounce back, especially when gas prices are rising. I think EVs are the future.”
