26 November 2018 by lberuti
GM ( General Motors Company ) announced today that they will cut more than 10,000 salaried staff and factory workers, while closing seven factories worldwide by the end of next year. This is part of a sweeping plan to prepare for a future of electric and self-driving vehicles. The structural changes are also meant to pivot towards producing SUVs and crossovers as customers’ preferences change, while abandoning some of the slower selling sedan models. If the company and its unions do not come up with an agreement to allocate more work to factories in North America, it could mean the closing down of four facilities in the United States and one in Canada. The planned job reductions, which come on the heels of surprisingly strong third quarter results, triggered some harsh comments from unions’ representatives that merely see the move as an attempt to close American plants and shift production abroad. It will surely not go down very well with the White House either, but the market did not seem too bothered. GM’s risk premium was marked 14bps tighter at 181bps, making it the best performer among the CDX IG constituents today.