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General Motors to cut around 500 staff to save $2 billion

General Motors

General Motors will cut around 500 executive-level and salaried employees to save expenses and increase its profits.

The layoffs affect staff in various departments in the motoring giant.

The cuts come around a month after GM CEO Mary Barra and CFO Paul Jacobson told investors that no job cuts were planned.

Read More: Palantir announces 75 job cuts as tech sector continues to shed workers

In a letter sent to staff, CPO Arden Hoffman highlighted the company's goal of $2 billion in cost savings over the next two years. 

He said this would be achieved by “reducing corporate expenses, overhead, and complexity in all our products.”

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The terminations would hit a “small number of global executives and classified employees following our most recent performance calibration.” 

The reductions began on Tuesday, February 28.

Read More: Telehealth startup Cerebral to slash 285 employees in third round of layoffs

GM says the layoffs were due to poor performance.

It added that the move assists in “managing the attrition curve as part of our overall structural costs reduction effort.”

The automotive giant employed around 86,000 hourly workers and 81,000 paid employees globally at the end of last year, which means the 500 cuts represent less than 1 percent of GM's salaried workforce.

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Last month, Jacobson informed investors that the firm planned to cut staff numbers through attrition rather than layoffs.

Until recently, the automotive sector was mostly unscathed by recent redundancies in the tech industry.

Earlier this month, Ford Motor announced 3,800 job losses in Europe over the next three years to implement a “leaner” structure as it concentrates on electric vehicle manufacturing. 

Others, such as Rivian Automotive, announced pay cuts, while Stellantis confirmed the closure of an Illinois plant.

Source: CNBC

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