Bloomberg Businessweek September 23, 2019
The Monday after last Thanksgiving,
Mary Barra, chief executive officer of General Motors Co.,
announced the automaker’s biggest layoff since its 2009 bank-
ruptcy. Five North American factories were marked for clo-
sure. Six thousand hourly jobs in the U.S. and Canada would
soon be eliminated, and about 18,000 salaried employees
would have until the end of the year to consider a buyout
package. GM needed more than a third of the salaried per-
sonnel to accept. Fewer than 2,000 did. The remainder would
have to be let go, which they were, starting in February.
On March 5, a couple thousand survivors crowded into
the atrium of GM’s engineering center in suburban Detroit
to hear Barra explain the overhaul at a town hall meeting.
Thousands more tuned in via webcast. Barra, a GM lifer who’s
been through plenty of similar moments as both boss and
underling, told her audience the company is undergoing a
wrenching but necessary transition. GM, she said, could no
longer invest in slow-selling sedans and small cars or in far-
flung markets that weren’t delivering significant profits. That
money had to be plowed into electric vehicles and self-driving
cars, which she described as the foundation of the company’s
future. “We need to seize this opportunity,” she told the silent
crowd. “Make no mistake, we are not here just to compete in
this new world ... we are here to win.”
The 46,000 auto workers who went out on strike on
Sept. 15 are here to win, too. They made concessions in jobs,
wages, and benefits to get GM through bankruptcy, and now
they want their quid pro quo. How the walkout is settled will
have much to do with how Barra arrived at this moment in
GM’s history. The world’s fourth-largest carmaker isn’t slash-
ing payrolls, shutting facilities, and going to the brink with the
United Auto Workers because cash is running low or sales and
profits are falling. On the contrary, GM has posted near-re-
cord adjusted profits of about $12billion for three straight
years. It has ample cash reserves. What it lacks—or at least,
what Barra lacks—is faith that the internal combustion engine
and human-driven cars will sustain it as a global power for
decades to come.
“There was a point in time where we were everywhere
for everyone with everything,” Barra said in an interview a
few months ago in her downtown Detroit office. “We had to
say, ‘OK, where are we deploying capital that’s not gener-
ating appropriate returns?’ Once you start to believe in the
science of global warming and look at the regulatory environ-
ment around the world, it becomes pretty clear that to winUnveiling a new Chevrolet Corvette in July