GM Laying Off 2K Due to Change in How We Buy Cars

Shifting demand from cars to trucks and SUVs is forcing General Motors to lay off more than 2,000 workers indefinitely at two assembly plants in Ohio and Michigan starting in January. The company said Wednesday it will suspend the third shifts at factories in Lordstown, Ohio, and in Lansing, Mich., because of the market change, which is growing and shows no sign of abating, the AP reports. About 1,250 workers will be furloughed at the Lordstown plant, which makes the Chevrolet Cruze compact car. Another 840 will be idled at the Lansing factory, which makes the Chevrolet Camaro muscle car and the Cadillac ATS and CTS luxury cars.

"It's supply and demand, and right now the demand is not there for what we have," says Glenn Johnson, president of a United Auto Workers local union at the Lordstown plant. Americans have been moving away from cars toward trucks and SUVs for several years now as gas prices have dropped and the larger vehicles have become more efficient. Last month, 61.6% of US new vehicle sales were trucks and SUVs. That's a record that is likely to be broken, says Jeff Schuster at the consulting firm LMC Automotive. Because of the shift, it's likely the GM layoffs won't be the last at auto factories that build only cars in the slowing compact, subcompact, and midsize segments, Schuster warns. (More auto industry stories.)