General Motors’ 78-year-old transmission plant in Warren, Michigan is halting production this week.
The Detroit-area plant is one of five in North America that GM last year announced would suspend operations as part of the company’s business transformation. GM plans to build fewer sedans as customers demand more trucks and SUVs. It also wants to reshape is business to eventually build more electric cars, while saving $6 billion annually starting at the end of 2019.
The Warren plant opened in 1941 and has been operated by GM (GM) since 1958. It produces six-speed transmissions for the Cadillac XTS and the Chevrolet Impala — both models that GM (GM) is discontinuing. GM (GM) is largely replacing those kind of transmissions with more advanced versions.
GM thanked the plant’s roughly 200 employees in a statement.
“We appreciate their commitment and hard work to build the highest quality possible into each and every transmission produced at Warren Transmission Operations,” GM said.
The company said 60 workers have transferred to other factories in the United States and 25 workers are retiring.
GM describes the plant as being “unallocated,” meaning the plant isn’t completely shutting down for now. Instead, it’s no longer producing anything else once it’s done with the current line of transmissions. The plant’s future depends on the ongoing negotiations between GM and the UAW Union.
“We have job opportunities for virtually every hourly employee at the impacted plants provided they are willing to relocate,” it said.
As part of GM’s modernization plan, the company is reducing its salaried workforce by 15%, including non-factory workers. The transition will come at the expense of about 8,000 salaried workers, and 6,000 hourly workers will either lose their jobs or be reassigned to other plants. GM previously offered voluntary buyouts for 18,000 salaried workers.