For the second time in three months, General Motors cut more than 1,000 jobs at Factory Zero, its all-EV assembly plant in Detroit-Hamtramck, Michigan, at least temporarily, as it “rightsizes” its electric vehicle production amid shifting consumer tastes.The company has initiated multiple layoffs, some temporary and some indefinite, affecting thousands of employees in 2026. This comes as U.S. EVs fall out of favor after the government let the $7,500 EV tax credit expire last September.GM expects a “benefit” of $1 billion to $1.5 billion due to “the actions [it ‘s] taken to rightsize [its] EV capacity,” the automaker said in its fourth-quarter earnings call.That benefit could go a long way toward plugging the hole left by the $1.6 billion in charges GM approved for a “planned strategic realignment of our EV capacity and manufacturing footprint” in the third quarter last year. GM shares were up modestly Monday, April 6.GM “rightsizes” EV production by cutting jobs General Motors temporarily laid off 1,300 workers at Factory Zero on March 16, with a plan to have them return to work on April 13, Wards Auto reported.“Factory ZERO will temporarily adjust production to align EV production with market demand. Impacted employees will be placed on a temporary layoff and may be eligible for sub-pay and benefits in accordance with the GM-UAW national contract,” a GM spokesperson told WardsAuto. The company took similar action in January, laying off 1,200 employees at the plant that manufactures the GMC Hummer electric truck and SUV, as well as the electric versions of the GMC.Related: BNP Paribas warns stakes ‘couldn’t be higher’ for Tesla stock investorsIn January, the company also revealed it was laying off more than 1,300 employees at its Lordstown, Ohio, assembly plant after sending a letter in October indicating that there would be a “mass layoff of GM hourly-represented employees.” While most layoffs were temporary, it indefinitely eliminated more than 450 jobs, reported NBC local affiliate 21WFMJ.GM says it took $6 billion in EV charges in the fourth quarter alone, including $1.8 billion in non-cash charges and $4.2 billion in supplier commercial settlements, impairments, and contract cancellation fees. That’s after GM said it recorded a non-cash impairment charge of $1.2 billion in the third quarter. The company took another $400 million in contract cancellations and commercial settlements fees.General Motors no longer operates the Lordstown, Ohio, assembly plant, having sold it in 2019. However, the company still maintains operations on the plant site, including Ultium Cells, which manufactures batteries for its electric vehicles.The company expected the changing political tides and the expiration of the EV tax credits to have a devastating effect on the industry. GM was “quick to respond to slowing EV demand by selling our share in the Ultium Cells Lansing plant and pivoting our assembly from EV to ICE production,” CEO Mary Barra said during the January call. GM confirmed the sale of its stake in the Ultium Cells electric vehicle battery cell plant in Lansing, Mich., in December 2024, according to Utility Dive, about four weeks after Donald Trump was reelected president.“Following recent U.S. Government policy changes, including the termination of certain consumer tax incentives for EV purchases and the reduction in the stringency of emissions regulations, we expect the adoption rate of EVs to slow,” GM said in an 8-K filing in October.The company’s board of directors approved third-quarter charges of $1.6 billion in GM North America for a “planned strategic realignment of our EV capacity and manufacturing footprint” that will match consumer demand.“However, with the evolving regulatory framework and the end of federal consumer incentives, it is now clear that near-term EV adoption will be lower than planned. That is why we are reassessing our EV capacity and manufacturing footprint…. By acting swiftly and decisively to address overcapacity, we expect to reduce EV losses in 2026 and beyond,” Barra said.
General Motors temporarily laid off 1,300 workers at Factory Zero on March 16, with a plan to have them return to work on April 13.Pugliano/Getty Images
General Motors plans to buy back $6 billion in shares in 2026; raises dividendDespite billions in EV-related charges, GM plans to reward shareholders generously in 2026. On Jan. 27, GM shared that its board of directors approved a new $6 billion share repurchase program, as well as a 3-cent-per-share increase in its quarterly stock dividend to 18 cents per share. The new rate is payable March 19 to shareholders of record on March 6.The company says it wants to reward shareholders because its overall strategy is working.“For several years now, GM’s strong brands and winning vehicles, as well as our technology-driven services and operating discipline, have delivered consistently strong cash generation,” said Barra.“This has allowed us to execute all phases of our capital allocation strategy, from investing in the business and our people to maintaining a strong balance sheet and returning capital to shareholders. We believe that formula is sustainable, which is why we’re increasing our dividend and planning future share repurchases.”Related: General Motors makes harsh decision affecting over 1,000 workers