In recent weeks, automakers and other companies in the auto sector have been scaling back their investments in electric vehicles (EVs), including laying off employees in several states.
The move comes in the wake of Republicans’ “big, beautiful bill” that repealed incentives for consumers to buy electric cars.
Specifically, GM is set to lay off 1,200 workers from its Detroit plant and another 550 from its Altium Sales plant in Ohio.
Meanwhile, another 850 are being temporarily pulled from an Ohio Altium sales plant and another 710 are being temporarily pulled from an Altium factory in Tennessee.
Although those layoffs were the largest recently announced, they are not the only ones.
Last month, EV-maker Rivian told employees it would let go about 4.5 percent of its workforce. Reuters reported that this showsmore than 600 jobs,
“With the changing backdrop of operations, we have had to rethink how we are scaling our go-to-market operations,” Rivian CEO RJ Scaringe said in a note to employees seen by The Hill.
Meanwhile, Frydenberg E-Power Systems said this week it will close two EV battery facilities in Michigan, laying off 324 employees.
“We have come to this difficult decision due to declining demand for heavy-duty electric and hybrid electric vehicles in North America,” the company said in a statement.
The move follows this year’s “big, beautiful bill” Tax credits for consumers eliminated This brought EV prices down to $7,500.
The credit expired at the end of September.
GM, whose spokespeople did not immediately respond to The Hill’s request for comment, in a recent note to investors cited the expiration of incentives as part of the need to reevaluate government policies and especially its electric vehicle strategy.
“With the evolving regulatory framework and the expiration of federal consumer incentives, it is now clear that EV adoption in the near term will be lower than planned,” CEO Mary Barra’s letter last month, before the layoffs were announced, said.
“That’s why we are reevaluating our EV capacity and manufacturing footprint. The work, which continues, resulted in a special charge in the third quarter and we expect charges in the future,” Barra said.
Meanwhile, Shawn Fenn, president of the United Autoworkers union, criticized both the company and the government.
“Last week, GM raised its expected annual profit to $13 billion. This week, they announced layoffs … the company is making billions in profits every year,” he said.
He said, “Going into the negotiations, we knew — and the company knew — that the electric vehicle transition was going to be volatile. The cuts in federal subsidies for EVs have made that volatility even worse.”
Stephanie Valdez Streety, director of industry insights at Cox Automotive, told The Hill that federal policies, particularly the expiration of tax credits, are a major factor in the layoffs.
“This has been significant in slowing EV demand,” Valdez Streety said.
However, he also noted other factors affecting automakers in general that may play a role.
“You also have tariffs going on. You have a chip shortage…there’s [an] The aluminum fires hurt production…there are all these different things going on that are just making navigation manufacturers have to do or increase in terms of production,” she said.
Mike Madowitz, chief economist at the Roosevelt Institute, said that while some of these layoffs may be shifted to other jobs, including equivalent jobs related to gas-powered cars, they are coming at a tougher time for manufacturing more broadly.
“It’s very difficult to notice that manufacturing employment has been basically falling since we announced the tariffs,” Madowitz said.
“If you’re making the multi-decade commitments that you make when you invest in auto and battery plants, you have to think more about your ability to export goods out of the U.S.,” he said.
