Washington Shares Displeasure with GM’s Resolve on Factory Closings

At the close of 2019, Washington shared its displeasure with General Motors’ resolve to close factories and lay off workers. Chief Executive Officer Mary Barra says the plan that would save General Motors about $6 billion involves laying off 14,000 workers and stalling five North American factories. This decision, she says, illustrates the company’s resolve in the face of huge industry challenges like higher supply costs and shifting customer preferences.

This announcement has been met with applause and backlash. Wall Street has largely applauded GM’s efforts to free money for investment in electric and self-driving vehicles. Others, however, have perceived this resolve as seriously undermining President Trump’s promises – promises to restore factory jobs in states like Ohio and Michigan. Furious criticism has also been hurled across both sides of the aisle in Congress.

“The U.S. saved General Motors, and for her to take that company out of Ohio is not good,” Trump told reporters. The President was of course referring to the government’s bailout of the auto maker in the midst of the Great Recession. “I told her I’m not happy about it at all.”

President Trump did not stop there. The very next day, he clarified the extent of his displeasure on Twitter. “It’s a great disappointment,” stated Larry Kudlow, the president’s top economic adviser.

To make matters worse, GM’s announcement came just days before the scheduled signing of a revised trade agreement with Mexico and Canada; this agreement provides higher incentives for building cars in North American factories that employ higher-paid workers.The explanation? GM was careful to say that cutbacks were because of slowing sales of small cars and sedans. The Chevrolet Impala and Cruze, for example, will be discontinued in the U.S. The company also noted that raw material costs rose $300 million in the second quarter, due to President Trump’s double-digit levies on steel and aluminum imports (which took effect in July).

U.S. Sen. Sherrod Brown also shared his displeasure with GM’s decision, “Taxpayers rescued GM.” He went on to refer to the financial crisis bailout, in which the government invested $51 billion to prop up the automaker, ultimately losing about $11.2 billion.

While GM pushes forward with its plans, others are still fighting to keep jobs where they are and have their “voices be heard”. As the taxpayers, lawmakers, and business owners alike wait to see what happens next, there are services available that can help, like tire financing bad credit. These services can help auto companies provide exceptional options to customers and keep business running smoothly.Author Bio:As the FAM account executive, Michael Hollis has funded millions by using tire financing bad credit solutions. His experience and extensive knowledge of the industry has made him financeexpert at First American Merchant.