General Motors to lay off 500 workers

General Motors announced a wave of layoffs to reduce the company's costs despite denying this possibility a month ago. Approximately 500 employees received a letter, accessed by CNBC, from the company's Chief People Officer Arden Hoffman. It detailed that the company had to save some $2 billion over the next two years and that they would "achieve this by reducing corporate expenses, overhead and complexity across all of our products."

Layoffs will be based on employee productivity and performance, the letter explains. What is not clarified is whether they will be undertaken in the U.S. of internationally.

The 500 employees represent less than 1% of GM's total workforce. Last year, the company reported having about 170,000 employees.

The announcement of these cuts comes a month after CEO Mary Barra suggested that layoffs were not on the factory's schedule. "We are not planning layoffs," she said during a meeting with investors. At that meeting, Barra did confirm that a $2 billion budget cut was planned, which would limit hiring.

In 2022, GM reported revenues of $156.7 billion, a figure above forecasts. In the previous year, it earned $127 billion.

Layoffs at Ford

A few days ago, Ford Motor Company announced that it will cut 3,800 jobs at its European branches. This included 1,300 layoffs in the United Kingdom, representing one fifth of its workforce in the British Isles.

The company justified these layoffs as part of a restructuring program and transition to electric vehicles.