Label General Motors Co.’s (NYSE: GM) comeback from Chapter 11 as complete despite the massive recalls it faces along with related costs to replace parts and possible liability settlements. The largest U.S. car company will add 1,400 jobs. And after years of auto job losses in Detroit, some of the new workers will be added in the Motor City, which has been decimated into a bankruptcy of its own.
According to the Detroit Free Press:
The company’s plans include a second shift at its Detroit-Hamtramck plant, where the automaker currently makes the Chevrolet Malibu, Chevy Impala, Cadillac ELR, Chevy Volt and foreign versions of these cars.
GM also plans to invest in its smaller Brownstown Township manufacturing plant, where the company currently produces batteries for the Volt.
GM will invest a total of $450 million in the two projects. The decision is also a signal that GM wants to push further into the electric car business which has been made more visible by the day because of the success of Tesla Motors, Inc. (NASDAQ: TSLA).
The Volt was supposed to become GM’s flagship as the company moved into the 21st Century. In 2007, then-CEO Rick Wagoner and legendary design chief Robert Lutz hosted a launch event of the car. Within three years, GM had filed for bankruptcy, and the Volt went on sale. From the start, it sold poorly and was considered yet one more GM debacle.
However, 2014 has become a watershed year for electric cars. Tesla’ market cap is a third of GM’s and more on some days. GM has its own luxury electric vehicle — the Cadillac ELR. And the Cadillac is the best chance GM has to enter the white hot market which Tesla dominates.
The addition of 1,400 people at GM seems small, based on the absolute number of people; GM now employs 219,000 people. But, with some of those people being added in Detroit, and added in a role to increase GM’s electric car market share, it has a meaning beyond simple headcount.
GM may also be helped by the fact that Tesla buyers in California will lose some tax credits.
Find a Qualified Financial Advisor (Sponsor)
Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
