Layoffs and a top exec out: what GM pullback on EVs means for you

General Motors recently took its biggest step yet to address a slowing electric car industry, and it's not a minor one.

GM has halted battery manufacturing in Ohio and Tennessee and reduced one of three shifts at its Detroit EV factory, resulting in the loss of approximately 1,750 jobs or temporary layoffs.

The business argues that "slower near-term EV adoption" and changes in regulations necessitate a restart.

GM CEO Mary Barra didn’t sugarcoat it. In a letter to shareholders, she said:

With the evolving regulatory framework and the end of federal consumer incentives, it is now clear that near-term EV adoption will be lower than planned.

The repercussions spread beyond the factory floors. GM's Senior Vice President of Software and Services Engineering David Richardson, who previously worked for Apple, is also out.

Richardson's resignation led to an emergency restructure led by GM's top product officer and even interim supervision from Barra herself.

These changes collectively lead to a more significant transformation.

GM was only a few weeks ago talking about its digital and electrified future. Now it's advising people to be careful, and if you're an EV purchaser or investor, this change may mean more than it seems.

GM makes cuts as EV demand slows down

General Motors isn't simply making little changes to manufacturing; it's slamming on the brakes.

The business said it will lay off around 1,750 workers who worked on electric vehicles and batteries. That includes roughly 1,200 workers at its Detroit-Hamtramck Factory Zero, which will operate with only one shift starting in January.

Ultium Cells, GM's joint venture with LG, will halt battery manufacturing for six months at two plants in Ohio and Tennessee.

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The business says it's reacting to "slower near-term EV adoption" and the evolution of government incentives and pollution laws.

Details on GM cuts to EV production:

• Detroit EV plant: One shift eliminated, 1,200 job losses
• Ohio/Tennessee battery plants: Paused production, hundreds furloughed
• Reason cited: Weak EV demand, emission rule shifts, end of tax credits
• Strategic shift: GM reassessing EV growth pace and manufacturing footprint

These changes aren't just one-time moves. They're part of a broader adjustment that CEO Mary Barra hinted at last week during the company's results, stating that GM will need to "right-size" its EV efforts as market signals shift.

Software shake‑up shows GM’s tech pivot hitting turbulence

GM is cutting jobs in more than just manufacturing; the C-suite is also seeing a shake-up.

Just days before Richardson suddenly left the firm, he had been on stage at the automaker's "GM Forward" event in New York, where he spoke of a daring AI-driven future.

Richardson was responsible for GM's efforts to develop next-generation software platforms, subscription services, and advanced driver-assistance technology. GM has noted that this area could generate $25 billion in annual revenue by 2030.

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With Richardson's departure, GM has moved software engineering under its product division, which Sterling Anderson, a co-founder of the self-driving firm Aurora and a veteran of Tesla, oversees.

Mary Barra is now in charge of several areas of Richardson's old organization, such as cybersecurity and IT.

How does it look? Not great.

GM is not only scaling back its electric vehicle plans, but also restructuring the team that was intended to bring about its digital future.

That begs the question: Was the tech side developing too quickly? Or does GM have to merge before it can grow?

Under the hood: GM’s EV reset and what it means for buyers

In theory, GM had a great quarter. It raised its full-year outlook after making $2.80 per share in the third quarter on $48.59 billion in sales. That's a lot more than what Wall Street predicted.

Mary Barra, the CEO, isn't pretending that everything is well beneath the hood, however.

Barra made it clear that the firm is putting things on hold, despite selling 67,000 EVs in the quarter and claiming a 16.5% market share for EVs.

“With the evolving regulatory framework and the end of federal consumer incentives, it is now clear that near-term EV adoption will be lower than planned,” she told analysts.

What does this mean in general? GM is slowing down its campaign for electric vehicles and going back to gas-powered cars, at least for now.

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That change has already attracted attention in Canada. Canada reduced GM's import limit by 24% after the company reduced output at its Ontario plants. This might mean GM's overseas partners will react strongly to the withdrawal of their EVs.

In the meantime, shoppers may soon notice the difference: There are fewer new models, supplies are tighter, and companies are being more careful with new ideas.

Can GM pull off this EV pullback?

GM's stock is unexpectedly holding up well despite the layoffs, plant slowdowns, and changes in leadership. Shares reached a 52-week high yesterday, rising more than 12% in the last month.

That might mean investors think GM is smart to cut down now and focus on making money, then change its business model to make electric vehicles later. But it won't be simple to go through the needle.

The business is banking on a slower, leaner launch of electric vehicles that focuses on keeping costs down, and using the same platform may finally make its $25 billion software vision and battery-led future a reality.

For now, however, it's prioritizing financial stability over revolutionizing the industry.

That leaves customers, investors, and even workers with an unpleasant question: What does it mean for the industry if GM, one of the biggest supporters of an all-electric future, is backing off?

The solution may rely not just on what GM does next, but also on how quickly purchasers come.

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