Asger Risom
Thousands of workers are set to lose their jobs after one of the world’s biggest carmakers admitted its electric vehicle strategy has run into serious trouble.
General Motors is heading into 2026 under intense pressure after confirming widespread job cuts linked to a sharp slowdown in electric vehicle adoption. The US auto giant says it will lay off more than 1,100 hourly workers as it unwinds parts of its EV expansion plans.
The move follows what GM described as weaker-than-expected demand for electric cars, triggering billions of dollars in charges and a significant earnings hit.
Costly unwind
GM confirmed it will take a $6 billion charge related to scaling back its electric vehicle investments. The company said “slower near-term EV adoption” was the main reason behind the decision.
Industry specialists estimate that around $4.2 billion of the total stems from cancelled contracts and settlements with suppliers, many of whom had prepared for much higher EV production volumes before the plans were revised.
On top of that, GM expects to record a one-time earnings hit of about $7.1 billion in its upcoming quarterly financial results.
Factories hit
The job losses have already had a visible impact on operations. GM’s Detroit-Hamtramck facility is now reported to be running at roughly half of its total capacity following the layoffs.
Analysts warn that GM is not alone in pulling back. Other major manufacturers have also slowed EV investment in recent months, raising concerns about wider job losses across the automotive supply chain.
Big ambitions, slower reality
GM significantly expanded its EV push during the Biden administration, when electric vehicles were central to US climate and industrial policy. In 2021, the company pledged that all of its cars and trucks would be zero-emissions by 2035.
The manufacturer currently offers 13 electric models across its brands, including the Chevrolet Equinox EV, Cadillac Escalade IQ and GMC Hummer EV. Despite that broad lineup, consumer demand has not grown at the pace executives once expected.
Policy shift blamed
GM chief executive Mary Barra said changes in government policy have contributed to the slowdown.
“With the termination of certain consumer tax incentives and the reduction in the stringency of emissions regulations, industry-wide consumer demand for EVs in North America began to slow in 2025. As a result, GM proactively reduced EV capacity,” she said.
Under President Donald Trump, federal EV tax credits and other incentives have been rolled back, reshaping the market and forcing manufacturers to reassess their electric strategies. For GM, the reset comes with a heavy human and financial cost.
Sources: General Motors
