The writer is a Los Angeles-based freelancer and former Detroit News business reporter. He publishes a blog, Starkman Approved.
By Eric Starkman
The Detroit News story headlined, “GM lays off 1,300 workers at FactoryZero EV plant” is illustrative of the charmed media coverage GM’s Mary Barra and Michigan Gov. Gretchen Whitmer enjoy.
GM didn’t just lay off 1,300 workers at its showcase EV plant in Detroit but rather idled the entire facility for at least a month. While the automaker says it is “temporarily” adjusting production to “align EV production with market demand,” GM has a history of idling plants supposedly on a temporary basis and then closing them permanently.
The layoffs were implemented two weeks ago. It’s a pretty sad commentary on the Detroit auto media that they only just now learned about a plant in their own backyard going dark.
Factory Zero is where President Biden five years ago hailed Barra for leading America’s EV transformation and took a spin in an EV Hummer, which he hailed as an example of America’s technology prowess. In addition to the Hummer, GM manufacturers other high prices electric SUV’s including the Cadillac Escalade IQ.
The Detroit News blames the decline in EV sales on Republicans ending a $7,500 tax credit for EV buyers and lessees; in fact, most of Factory Zero’s vehicles never qualified for the $7,500 tax credit because they exceeded the qualifying price threshold.
GM invested $2.2 billion to transform Factory Zero, a shuttered gas engine plant, into its showcase EV factory that at its peak employed some 4,000 factory workers. As a condition for that investment, Whitmer agreed to relieve GM of its obligation to retain 4,000 headquarters jobs at its landmark Renaissance Center in downtown Detroit that was part of a $3.5 billion previous Michigan taxpayer giveaway.
GM this year abandoned the RenCen and relocated an undisclosed number of employees to a Dan Gilbert’s Hudson’s Tower where the automaker leases four floors with 14 large conference rooms; 52 huddle rooms; and 63 phone rooms. Only four executives have assigned officers. Not surprisingly, GM won’t disclose how many employees are permanently assigned to its “headquarters” and will pay Detroit’s commuter tax.
It’s hard to imagine the EV Hummer, which GM once claimed had a two-year order backlog, is long for this world. At the end of February, some dealers had a 120+ day supply and there was a report of a 2024 EV Hummer with an MSPR of $106,000 and only 2,000 miles that sold at auction for $68,500. An auto YouTuber reported attending an auction where 20 new Hummers were sold.
Desperation to Unload
Underscoring GM’s desperation to unload its EV Hummers, the company is offering 0.9% APR financing for 36 months on the vehicle, as well as other incentives for qualifying vehicles.
Environmentalists should be at the front of the line cheering the Hummer’s demise. A climate group deemed the Hummer more environmentally harmful than most gas engine vehicles. My thoughts on people who choose to drive one.
My predicted Detroit legacy for Barra and Whitmer: an abandoned office complex and a shuttered more than 4 million sq. ft. factory.
That GM and billionaire Dan Gilbert want to mooch an additional $250 million from taxpayers in the wake of Barra spending more than $23 billion on stock buybacks only adds to the disgrace.
Meanwhile, Ford spent more than $1 billion to build its new Dearborn headquarters and more than $900 million to restore Michigan Station, where it hopes to place some 2,500 workers by 2028.
Despite being headquartered in Dearborn, Ford will likely have more employees in Detroit than GM.
