US Markets
Monday, August 19th, 2024 2:20 pm EDT
Key Points
- General Motors is laying off over 1,000 salaried employees globally in its Software and Services division, including about 600 positions at its tech campus near Detroit. This move is part of a broader effort to streamline operations and focus on key investments for future growth, particularly in emerging markets like electric and software-defined vehicles.
- Leadership changes and focus shift: The layoffs follow recent leadership changes in the division, including the departure of former Apple executive Mike Abbott. The division now has new leaders, Baris Cetinok and Dave Richardson, who will oversee critical areas such as software product management and engineering.
- Strategic shift towards software monetization: GM is concentrating on monetizing its software, including subscription-based services and advanced vehicle features, as part of its strategy to boost recurring revenue and adapt to industry trends.
General Motors (GM) is laying off over 1,000 salaried employees worldwide within its Software and Services division as part of an effort to streamline operations and boost efficiency. The move, affecting about 1.3% of GM’s global salaried workforce, includes roughly 600 job cuts at the company’s technical campus near Detroit. These layoffs follow leadership changes within the division, including the departure of former Apple executive Mike Abbott earlier this year for health reasons.
The decision to reduce the workforce aligns with GM’s broader strategy to focus on key investments that will drive future growth, particularly as the company transitions toward emerging markets such as electric vehicles (EVs) and “software-defined vehicles.” Automakers like GM are increasingly focusing on software monetization as a way to generate recurring revenue, such as through subscriptions for vehicle features. GM has emphasized the potential of its Software and Services division to play a major role in its long-term profitability.
The Software and Services division is responsible for a broad range of functions, including GM’s infotainment systems, its OnStar brand, and other vehicle features and development areas. Two GM executives, Baris Cetinok and Dave Richardson, now oversee the division following Abbott’s departure. Cetinok, a seasoned software executive, leads product management and the design of GM’s software roadmap, while Richardson heads software engineering, covering critical areas such as embedded platforms and advanced driver-assistance systems like GM’s Super Cruise.
The layoffs come as GM and other automakers look to reduce costs and brace for potential downturns in the automotive industry. Simultaneously, they are making significant investments in electric vehicles and other technology-driven areas, where software is expected to play an increasingly central role in the future of transportation. Despite the job cuts, GM is positioning itself to lead in these emerging markets, with software and services expected to become a critical component of its business model going forward.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/08/19/gm-lays-off-more-than-1000-salaried-software-and-services-employees.html
