GM announced last week it will shut down four factories across the US (Michigan, Ohio, and D.C.), laying off about 15,000 employees, so that it can strengthen its position in the electric vehicle (EV) race. In order for GM to compete for EVs, it has to go on a Slimfast juicing diet to save about $6 billion by 2020. GM realizes that most of their sedan sales have been declining for years now (thanks to...millennials + ridesharing), so it will shut down its factories that manufactures their Buick LaCrosse, Chevrolet Impala, Cadillac CT6 sedans, Chevy Volt, and Chevy Cruze. Instead, the company will make more SUVs and allocate more resources to building purely electric cars.
But how could this affect me even if I don’t work for GM?
GM and Tesla have been receiving government subsidies for each electric car sold, and these carmakers pass down those savings to you the consumer as a discount of $7,500 aka “income-tax credit” to make your electric car purchase more affordable. Due to this announcement of layoffs, Trump has threatened to cut GM’s tax subsidies which is expected to expire when the company has sold 200,000 qualifying electric cars. This means that buying an electric vehicle could become more expensive for you if there are no more tax credits. Well you know how capitalism works.