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GM eliminating five sedans in major reorganization

The automaker will also shutter five North American plants

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General Motors has followed Ford's lead in reducing its fleet, retiring some of its sedans, including the electric Chevy Volt, the full-size Impala, and the compact Cruze.

GM said the move as part of a transition to the automotive future, where consumers are purchasing fewer cars and being more discerning about the vehicles they do buy.

“The actions we are taking today continue our transformation to be highly agile, resilient and profitable while giving us the flexibility to invest in the future,” said GM Chairman and CEO Mary Barra. “We recognize the need to stay in front of changing market conditions and customer preferences to position our company for long-term success.”

As part of the transition, GM will slash its salaried workforce by 15 percent and shut down production at five North American plants. Karl Brauer, executive publisher at Autotrader and Kelley Blue Book, says the industry has been bracing for impending upheaval.

First major preview of the future

"Today we got our first major preview of how this upheaval will manifest," Braur said in an email to ConsumerAffairs. "General Motors’ CEO Mary Barra has always moved quickly to address the company’s challenges, and today’s announcements remain true to that leadership style. She’s moving GM toward advanced technology and away from fading models, the market has largely abandoned. Each of these moves will contribute to GM’s long-term financial and competitive health, though they take a heavy toll on much of the current workforce."

With the plant closings and force reduction, GM will phase out the Chevy Volt, its pioneering electric; the Chevy Cruze, a compact that saw September sales drop by 26 percent; the Impala, a sedan whose lineage goes back to the 1950s; the Buick LaCrosse, favored by older consumers; and two Cadillac models, the CT6 and XTS.

Following Ford

In their place, GM will focus on turning out more SUVs, hatchbacks, crossovers, and trucks. It's a move similar to the one Ford announced in April as the carmaker said it would phase out nearly all of its sedans in North America and focus on producing trucks and SUVs.

For GM, five production plants will no longer be needed. They are the Oshawa Assembly in Oshawa, Ontario, Canada; Detroit-Hamtramck Assembly in Detroit; Lordstown Assembly in Warren, Ohio; Baltimore Operations in White Marsh, Md.; and Warren Transmission Operations in Warren, Mich.

Even though it's unplugging the electric Volt, GM tells Bloomberg News that it is still committed to electric vehicles, but considered the Volt aging technology that is increasingly less viable in the marketplace.

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