General Motors’s plans to slash 15,000 jobs and shutter up to four U.S. factories sparked a firestorm of criticism from Washington on Monday.
The company’s plans to massively restructure its business played well with investors, sending GM’s stock rising. But President TrumpDonald TrumpSix big off-year elections you might be missing Twitter suspends GOP Rep. Banks for misgendering trans health official Meghan McCain to Trump: 'Thanks for the publicity' MORE and lawmakers from both parties blasted the company for moving to cut jobs nine years after a multibillion-dollar auto industry bailout.
Trump said Monday that he urged General Motors CEO and Chairman Mary Barra to keep producing cars in the Lordstown, Ohio, plant the company plans to close and told her that GM “better get back in there soon.”
“I love Ohio,” Trump told The Wall Street Journal. “I told them, ‘you’re playing around with the wrong person.’ ”
Democrats and Republicans from states hosting targeted plants accused GM of betraying the workers who devoted their careers to the iconic automaker and the taxpayers that saved it from failure during and after the Great Recession.
Ohio and Michigan officials say they will push Barra for a reprieve from the planned cuts, but local company employees are bracing for devastating plant closures as soon as March 2019.
“This decision is corporate greed at its worst,” said Sen. Sherrod BrownSherrod Campbell BrownWhen the Fed plays follow the leader, it steers us all toward inflation Which proposals will survive in the Democrats' spending plan? Senate Democrats call for diversity among new Federal Reserve Bank presidents MORE
(D-Ohio) in a statement.
GM announced Monday it would not assign products in 2019 to auto assembly plants in Lordstown; Detroit-Hamtramck, Mich.; and Oshawa, Ontario, Canada, and auto parts factories in Warren, Mich., and White Marsh, Md.
As many as 5,901 hourly and 804 salaried workers could lose their jobs if GM does not allocate a new product to the plants, which produce parts for several Chevrolet, Cadillac and Buick vehicles that GM will scrap within the next two years.
GM also revealed an impending 15 percent cut to its corporate workforce and the elimination of 25 percent of executive roles. The cutbacks would save the company $6 billion by the end of 2020, but cost roughly 15,000 jobs.
GM’s announcement enraged government officials, autoworkers and unions that could be harmed by the plant closures, spurring walkouts at the Oshawa plant and deep anxieties across the industrial Midwest.
Trump told reporters Monday he would put intense pressure on GM to keep the Lordstown assembly factory open and stop producing cars in China, where the company operates a handful of plants.
“I said, ‘This country’s done a lot for General Motors, you better get back in there soon. That’s Ohio, and you better get back in there soon,’ ” Trump said.
“I have no doubt that in a not-too-distant future they’ll put something else. They better put something else in.”
Barra said Monday that the company’s plan would allow it to “continue our transformation to be highly agile, resilient and profitable, while giving us the flexibility to invest in the future.”
The company’s stock closed 4.8 percent higher in Monday trading as Wall Street anticipated widening profit margins.
Elected officials representing workers in GM’s crosshairs, though, tore into the company soon after it announced plans to scale back its North American operations.
GM received $51 billion in federal bailout money after the company went bankrupt in 2009, paying back all but roughly $11 billion by 2013. While the government rescue package helped save GM, the company has steadily downsized its U.S. manufacturing operations amid lagging sales.
“We fought together to keep GM afloat and the American taxpayers bailed them out when they were on the verge of bankruptcy,” said Rep. Tim RyanTimothy (Tim) RyanPennsylvania Republican becomes latest COVID-19 breakthrough case in Congress Ohio Democrat calls Vance an 'ass----' over Baldwin tweet Two senior House Democrats to retire MORE (D-Ohio), whose district includes the Lordstown plant.
“Thousands of families have sacrificed to build GM into what it is today. And in return, GM has turned its back on us when we need them the most.”
Sen. Rob PortmanRobert (Rob) Jones PortmanOvernight Defense & National Security — Presented by Raytheon Technologies — Biden backtracks on Taiwan Top GOP senators want joint review of Afghan visa process Timken rolls out six-figure ad campaign, hits Fauci MORE (R-Ohio) said that he was “deeply frustrated” by GM’s decision and that the company “let Northeast Ohio down.”
GM’s pullback from the U.S. is the latest blow for a battered American auto industry facing several dire threats in the coming year.
Trump’s tariffs on imported steel and aluminum have spiked production costs for U.S. automakers struggling to compete against foreign rivals. The president’s plans to impose tariffs on foreign car companies could send prices across the sector skyrocketing and roil the global economy.
Rising trade tensions between the Trump administration and key trading partners made worse by waning global growth could also pose dangers for the industrial Midwest and the auto industry that once powered its growth.
Trump has pledged to revive the U.S. auto industry and end decades of outsourcing that has seen iconic carmakers move jobs abroad. His pitch to boost U.S. automakers against foreign rivals helped him win voters in former Democratic strongholds in Ohio, Michigan and Wisconsin.
Rep. Debbie DingellDeborah (Debbie) Ann DingellWhich proposals will survive in the Democrats' spending plan? The Hill's Morning Report - Presented by Uber - Biden makes his pitch as tax questions mount Democrats see light at end of tunnel on Biden agenda MORE (D-Mich.), who represents parts of the Detroit suburbs, said GM’s announcement was a “warning” that Congress must work together to revive the struggling U.S. auto industry.
“If we want our auto industry to continue to be the global leader in transforming mobility, federal policy must ensure we keep them at the forefront of innovation and technology,” said Dingell.