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Another American car brand is about to close its transmission plant after Ford closed its gearbox plant in France. On July 31st, the United Automobile Union (UAW) revealed that GM would close its Warren transmission plant in Michigan, which would cost 100 workers their jobs. GM said it would provide all unemployed workers with the opportunity to transfer to other factories.

As part of GM's restructuring plan, GM announced as early as November that it would close seven plants in 2019 to save costs and optimize expenses. these include five local plants in North America and two outside North America. Through the above measures, GM can save about $6 billion a year.

GM is eager to implement its restructuring plan because of falling sales and shrinking revenue. GM sold 814000 vehicles in China in the first quarter of 2019, down 17.4 per cent from a year earlier and 15.6 per cent from the previous quarter, according to GM's first-quarter results. Its operating income has also been affected by the sharp decline in sales in China. In the first quarter of this year, GM's revenue was just $34.88 billion, down 3.4% from a year earlier and 9.2% from a month earlier. Sales and revenue have both fallen, forcing GM to speed up its restructuring plan to improve cost-effectiveness.

In fact, as the traditional car market begins to weaken, GM will gradually focus more and more energy on new energy. As early as September 2017, Mary Bora, the first female CEO in general history, said that electrification is a key element of GM's global strategy, and that the company plans to launch at least 10 new energy models by 2020, and its future development focus and major investment will also be on new energy.

As the focus of GM's development begins to shift towards new energy, the importance of transmissions has greatly diminished. The closure of the Warren transmission plant in Michigan is part of GM's cost-saving plan on the one hand, and to accelerate the shift to electrification on the other. With the gradual implementation of GM's restructuring plan, plant closures and layoffs may become the norm for GM next year.

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