GM cuts over 1,000 tech jobs as it explores new AI initiatives
Nickie Louise
Posted On August 19, 2024
General Motors (GM) is cutting more than 1,000 jobs globally in its software and services division to concentrate on what it calls “high-priority” projects, according to a report from CNBC.
This decision follows a review aimed at streamlining operations within the division, with a focus on enhancing the Super Cruise driver assistance system, improving the quality of its infotainment platform, and exploring the potential of AI.
Among the layoffs are about 600 positions at GM’s tech campus near Detroit. These cuts come just months after leadership changes within the division, including the departure of former Apple executive Mike Abbott in March due to health reasons, less than a year after joining GM.
“As we build GM’s future, we must simplify for speed and excellence, make bold choices, and prioritize the investments that will have the greatest impact,” a GM spokesman said in an emailed statement. “As a result, we’re reducing certain teams within the Software and Services organization. We are grateful to those who helped establish a strong foundation that positions GM to lead moving forward.”
The spokesperson confirmed the reduction in certain teams within the Software and Services organization and expressed gratitude for the contributions of those affected, CNBC reported.
While GM did not disclose the exact number of layoffs, a source close to the situation confirmed that over 1,000 salaried employees would be laid off, with 600 of those in Warren, Michigan. Impacted employees were notified on Monday morning.
These layoffs represent roughly 1.3% of GM’s global salaried workforce, which stood at 76,000 as of the end of last year, including about 53,000 in the U.S.
Automakers, including GM, are cutting costs and reducing headcount amid concerns of an industry slowdown, while also investing heavily in emerging areas like electric vehicles and software-defined vehicles.
This move by GM follows a broader trend in the tech sector, where companies have been trimming their workforces in response to economic challenges.
Late last year, GM partnered with Google Cloud on AI initiatives to bring conversational AI technology into millions of GM vehicles and help drivers.
“Generative AI has the potential to revolutionize the buying, ownership, and interaction experience inside the vehicle and beyond, enabling more opportunities to deliver new features and services,” Mike Abbott, executive vice president, Software and Services, GM, said at the time. “Our software-led approach has accelerated the creation of compelling services for our customers while driving increased efficiency across the GM enterprise. The work with Google Cloud is another example of our efforts to transform how customers engage with our products and services.”
GM is the latest in a series of Fortune 500 companies to announce staff cuts. In recent months, Cisco and Intel reduced their headcount and slowed hiring as global economic growth weakens due to looming recession, inflation, and higher interest rates.
According to Layoffs.FYI, a site tracking layoffs in the tech industry, over 404 companies have cut a total of 132,498 jobs so far this year.
