ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailMenu BurgerPositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter
Companies

Trump says GM should stop China production in restructuring

President vents ire over automaker's shutdowns of American plants

Trump blasted GM's plan to cut U.S. jobs.   © Reuters

PALO ALTO, U.S. -- U.S. President Donald Trump expressed strong dissatisfaction with General Motors after the automaker announced a restructuring plan on Monday that centers on slashing employment and production at North American plants.

Trump also said GM should halt car production in China instead of cutting it in North America.

GM announced on Monday that it will reduce its global salaried workforce by 15% and stop allocating production of future products to five plants in North America as it cuts costs tied to conventional gasoline-powered offerings and diverts resources to new technologies like automated vehicles and electrics.

The U.S. carmaker began offering buyouts to about 18,000 North American workers in late October. According to Monday's announcement, it will stop allocating future products to assembly plants in Canada, Detroit and Ohio, as well as two American "propulsion plants," in 2019. It has not said when the facilities will be taken offline.

Two more plants outside North America will also cease operations by the end of next year, in addition to the Gunsan plant in South Korea whose shutdown was previously announced.

"We don't like it," Trump told reporters on Monday before departing from the White House by helicopter.

"I was very tough" in a conversation with GM CEO Mary Barra on Sunday night, he said.

A worker at the assembly line of Baojun E200 electric vehicles at a plant of SAIC-GM-Wuling, a joint venture among SAIC Motor, General Motors and Liuzhou Wuling Motors.    © Reuters

"I spoke with her when I heard they were closing and I said, 'You know, this country's done a lot for General Motors, [which had] better get back in there soon' -- that's Ohio," he said.

In a separate interview with The Wall Street Journal, Trump said GM should stop making cars in China and open a new plant in Ohio to replace the facilities where the company is planning to end production.

GM, along with Volkswagen, is one of the biggest auto players in China, having production sites in Shanghai, as well as Liaoning and Shandong provinces.

"I have no doubt that in a not-too-distant future, they'll put something else," Trump said on Monday of GM's decision to idle a plant in Lordstown, Ohio.

"They'd better put something else in," he told reporters.

In a 2017 speech in Youngstown, Ohio, near the GM plant in question, Trump had vowed that the jobs were "all coming back."

GM plans to streamline its operations, such as the costly development process for car platforms, and cut the number of executives by 25%.

GM expects to post $3 billion to 3.8 billion in costs associated with this restructuring. The bulk will be booked in the October-December quarter of 2018 and the January-March period of 2019. By cutting costs and reining in investment, the automaker expects to improve free cash flow by an annual $6 billion.

While slashing human resources for production and gasoline car development, GM will double in the next two years resources for electric and self-driving programs. "This is about making sure GM is lean and agile" to get in front and lead in autonomous and electric vehicles, Barra told reporters on Monday.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends October 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media