General Motors (GM) has announced the termination of more than 1,000 paid workers across its software and service divisions globally. In a statement on August 19, GM stated that “as we build GM’s future, we must simplify for speed and excellence, make bold choices, and prioritise the investments that will have the greatest impact.” The statement verifying layoffs was first reported by CNBC.
There will be about 600 job losses atGeneral Motors’ innovation centre located in Warren, Michigan, according to the portal. The site reportedly has a tech campus wherein over 21,000 individuals are employed. GM stated that around 50% of the job reductions were in the US.
As per Reuters, the company clarified that the reductions were not the result of cost-cutting measures, but rather of an operational assessment as Mike Abbott, the executive vice president of software and services, exited in March for health-related reasons.
Abbott continues to serve as CEO Mary Barra’s senior advisor. Former Apple (AAPL) executive Abbott initially joined the company in May 2023 with the primary responsibility of developing enterprise and vehicle software.
Dave Richardson, Apple’s engineering leader who assisted in establishing cloud computing firm Skytap, and Baris Cetinok, a former Apple (AAPL) executive, are currently in charge of the software and services division. As per Quartz, Richardson is in charge of commercial solutions and driving assistance systems, while Cetinok manages the teams in charge of developing software programmes.
At the end of the previous year, the corporation employed 76,000 people worldwide, the percentage of layoffs is around 1.3% of that number. This comprised around 53,000 paid personnel from the United States. According to CNBC, the automobile industry is fearing a downturn, therefore manufacturers are attempting to slash expenses and, in many cases, reduce personnel. At the same time, they are investing billions of dollars in growing sectors, such as software-defined vehicles and all-electric vehicles.
For automakers like GM, software monetisation has become a top priority. As per CNBC, they are focusing on subscription-based and other recurring income streams to boost revenue. The news outlet added that the automaker’s software and services operations are responsible for a wide range of sectors, including infotainment, its OnStar brand, and upcoming areas like subscriptions along with additional vehicle features and development.
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