USA: GM cuts 5,500 jobs as EV output slows after tax credit rollback

General Motors has confirmed that approximately 5,500 employees have been placed on temporary or indefinite leave. The cuts come as the company reviews EV output levels after the US government ended the $7,500 tax credit in September.

General motors gmc hummer ev produktion production min — Image: General Motors

GM already announced in September that it would scale back production of the GMC Hummer EV and Cadillac Escalade IQ at its dedicated EV plant in Detroit-Hamtramck. The goal was to suspend two shifts for just over a month. But the “temporary adjustments to production to align to market dynamics”, as GM described it, seem to continue.

According to Bloomberg, some 3,400 workers at the Factory Zero in Detroit, Michigan, were affected. And only 1,200 of them will be brought back. “The remaining 2,200 will be furloughed indefinitely,” the news outlet states.

There were also cutbacks at the Spring Hill plant in Tennessee last month, where GM manufactures two Cadillac electric SUVs, namely the Lyriq and the Vistiq. It was reported that production of these models would be reduced in the first five months of 2026, with one of the two shifts temporarily laid off. Additionally, the plant is set to close for an extra week in October and November.

Now, it seems that 710 workers there have been laid off. GM also cut its workforce at its Ultium battery plant in Ohio by 1,400 staff. According to GM spokesperson Kevin Kelly, 850 of them will be asked to come back, while the remaining 55o layoffs are indefinite.

Bloomberg does not mention Fairfax, where production of the new Chevrolet Bolt is scheduled to begin later this year. However, earlier reports suggest that the plant has also been affected by layoffs, as GM is postponing the start of a second shift at its Fairfax assembly plant near Kansas City “indefinitely.”

The adjustments underscore a broader slowdown in GM’s EV rollout. Even though the carmaker recorded growing EV sales figures prior to the end of the EV tax credit, which ended on 30 September.

Against this backdrop, General Motors presented a more differentiated product strategy in early summer. GM is shifting back to petrol engines in its planned drive mix. At the same time, however, the company announced another affordable next-generation electric vehicle for its plant in Kansas.

GM plans to invest around four billion US dollars over the next two years to increase production at its US plants. Three vehicle plants in Michigan, Kansas and Tennessee are set to benefit most from this investment, with the aim of assembling ‘more than two million vehicles per year in the US’ in future. Exactly how production volumes will be distributed among the various drive types has not been specified.

bloomberg.com