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General Motors (GM) is laying off more than1,000 salaried employees globally from its software and services division.
Like other large U.S. companies including Cisco and Intel, GM’s announcement comes as part of a broader strategy to streamline the company’s research and development efforts. CNBC reports the automobile giant will focus on emerging technologies including electric vehicles and software-defined features.
The reduction represents about 1.3% of GM’s global salaried workforce, which totals 76,000 employees, as of the end of last year. Approximately 600 of these job cuts are based around the company’s headquarters in Detroit.
The layoffs are a partial reversal of GM’s previous hiring sprees. The Wall Street Journal reports that in 2022, GM had announced plans to add 8,000 tech-focused employees in an effort to keep pace with competitors like Tesla and various Chinese electric vehicle startups. However, the company now finds it necessary to reduce its headcount to manage costs more effectively and reallocate resources towards high-impact areas.
The decision to cut more than 1,000 jobs also follows recent leadership changes within the division, particularly the departure of former Apple executive Mike Abbott in March, and the appointment of Baris Cetinok and Dave Richardson to key roles in the software division.
The affected software and services division is crucial for GM’s future vision, covering a wide array of functions from infotainment systems and the OnStar brand to new vehicle features and development. Specifically, the division is focused on monetizing software and pursuing recurring revenue streams through subscriptions and other digital services.
The layoffs at GM coincide with a shift in how automotive and tech industries are approaching the future of work. Many car manufacturers are transitioning from traditional automotive production to integrating advanced technologies and digital experiences in their vehicles.
As automotive companies adapt to economic pressures and increased competition, there is a growing emphasis on prioritizing efficiency and strategic investment in high-growth areas like electric vehicles and software-defined features.
This trend points to a future workforce shifting toward specialized roles centered on digital services and automation. It also shows how traditional industries are increasingly embracing tech-driven strategies.
