G.M. to Idle Plants, Cutting Thousands of Jobs in North America as Sales Slow

From today’s New York Times:

General Motors announced Monday that it planned to idle five factories in North America and cut roughly 14,000 jobs in a bid to trim costs. It was a jarring reflection of the auto industry’s adjustment to changing consumer tastes and sluggish sales.

The move, which follows job reductions by Ford Motor Company, further pares the work force in a sector that President Trump had promised to bolster. Referring to G.M.’s chief executive, Mary T. Barra, he told reporters, “I spoke to her and I stressed the fact that I am not happy with what she did.”

Mr. Trump also invoked the rescue of G.M. after its bankruptcy filing almost a decade ago. “You know, the United States saved General Motors,” he told reporters, “and for her to take that company out of Ohio is not good. I think she’s going to put something back in soon.”

In addition to an assembly plant in Lordstown, Ohio, the cuts affect factories in Michigan, Maryland and the Canadian province of Ontario.

Part of the retrenchment is a response to a slowdown in new-car salesthat has prompted automakers to slim their operations and shed jobs. And earlier bets on smaller cars have had to be unwound as consumers have gravitated toward pickup trucks and sport-utility vehicles as a result of low gasoline prices.

In addition, automakers have paid a price for the trade battle that Mr. Trump set in motion. In June G.M. slashed its profit outlook for the year because tariffs were driving up production costs, raising prices even on domestic steel. Rising interest rates are also generating headwinds.

Read the complete article here.

Cisco cuts 4,000 jobs despite better than expected quarterly earnings

The nation’s largest computer infrastructure company today announced it would cut 4,000 jobs, representing 5 percent of its workforce, citing the challenge of global competition as reason to reorganize despite its quarterly report posting better than expected profits.

John Chambers, CEO said that in spite of the earnings report, Cisco faced challenges ahead, though he was short on whether there were any specific challenges requiring a trimmer workforce.

“We’ve got to take out middle-level management,” he said. “What I’m really after is not speed of decisions but speed of implementation.” He said that the company’s performance had improved over the last year, but that “it’s just been slow.”

Translation:  Even though the company reported it earned $2.27 billion in the fourth quarter, up from $1.92 billion at this time last year, the 6 percent overall increase in revenue to $12.42 billion from $11.69 billion was not a strong enough showing, and more needed to be done to keep up appearances of short-sighted profiteering, even if that meant cutting thousands of jobs in an already jobless economic recovery.

Citibank to eliminate 11,000 workers

In a shake up last month Citi’s executive board ousted its former CEO Vikram Pandit, paving the way for today’s announcement that the country’s second largest bank would cut 11,000 jobs in exchange for a $1 billion charge. The bank has been slow to bounce back from the recession despite cutting its workforce by 33 percent since 2007.