General Motors to lay off thousands of workers amid slower EV demand and regulatory shifts

The layoffs, earlier reported in May 2025, will affect about 1,200 employees at GM’s Detroit-area Factory Zero, which produces the Chevrolet Silverado, GMC Sierra, and Hummer EVs, while another 550 workers will lose their jobs at GM’s Ultium battery cell plant in Warren, Ohio. 

Additionally, the company will temporarily lay off 850 workers in Ohio and 700 employees in Tennessee, with battery cell production at both sites to be paused starting January 2026. 

“In response to slower near-term EV adoption and an evolving regulatory environment, General Motors is realigning EV capacity,” the company said in a statement. 

Adding, “Despite these changes, GM remains committed to our U.S. manufacturing footprint, and we believe our investments and dedication to flexible operations will make GM more resilient and capable of leading through change.” 

The company added that impacted employees “may be eligible to continue receiving a significant portion of their regular wages or salary, plus benefits,” and that cell production is expected to resume by mid-2026. 

The move comes amid a broader industry pullback from EV investments following the Trump administration’s rollback of a $7,500 federal tax credit for EV buyers, a policy change that experts say could cause EV sales to drop by as much as 50% in the coming months. GM has already been gradually reducing its EV production this year. From January, the Detroit EV plant will cut output by 50%, operating on a single shift instead of two.

Of the 3,400 workers furloughed earlier at Factory Zero, about 2,200 are expected to return when the plant resumes operations, while the remaining 1,200 will be laid off indefinitely, according to a Bloomberg report. 

The company has also cancelled production of its BrightDrop electric van and trimmed its EV sales forecast for the year, citing weak consumer demand and rising costs. 

Last week, GM Chief Executive Officer Mary Barra also acknowledged the shift, stating, “With an evolving regulatory framework and the end of federal consumer incentives, it’s clear that near-term EV adoption will be much lower than planned.” 

The United Auto Workers (UAW) union sharply criticized the move, pointing out that GM had recently raised its expected annual profits to $13 billion. UAW President Shawn Fain said, “The UAW will continue to fight for more investment in both internal combustion engine and EV production at GM and beyond.”

GM’s latest job cuts also follow the company’s decision to eliminate around 500 white-collar positions last week. Once seen as the frontrunner in the U.S. EV race, GM had pledged in 2021 to sell only electric vehicles by 2035. However, with declining sales, the loss of federal subsidies, and a shifting policy environment, the automaker now appears to be tapping the brakes on its electric future, aiming instead to stabilize operations and reduce EV-related losses by 2026.