GM cuts shift at Spring Hill plant after pandemic hurts demand

The COVID-19 pandemic's impact on market demand has led General Motors Co. to lay off the third shift at its Spring Hill, Tennessee, plant. 

The layoff, which comes a week after GM initially just postponed the addition of the shift, affects 680 employees at the plant where the Cadillac XT5, XT6 and GMC Acadia SUVs are built. Transfer opportunities to other plants depend on the provisions in the GM and the UAW labor agreement.

"Today’s market conditions continue to evolve as we see the impact of COVID-19," GM spokesman David Barnas said in a statement. "We believe the best way to react to this unforeseen change in our market is to reduce output and operate on two shifts effective immediately. This adjustment allows the plant to maintain stable production, protect the value of our brands in any sales environment, and to provide the smallest impact to plant employment going forward.”

Spring Hill is, so far, the only GM plant to see an impact from the coronavirus causing demand to dwindle. GM is continuing its push to get back up to full production across all of its plants by the end of June after restarting them in mid-May following an eight-week pandemic-induced shutdown.

The plant had three shifts prior to closing in mid-March as the coronavirus started its aggressive spread across the country. The third shift was scheduled to be back on June 21, Spring Hill United Auto Workers Local 1853 Shop Chairman Mike Herron said, but GM postponed the call back last week, later deciding to cut the shift indefinitely. 

"This is a direct result of the market just didn't rebound as quickly as we thought it would," Herron said. "We actually had plans to bring everybody back and it just didn't materialize because the market didn't materialize."

First-quarter 2020 sales of the XT5 were down 32% year over year as a result of the coronavirus pandemic, The new XT6, a three-row crossover, had just over 5,074 sales. Sales of the GMC Acadia were down 43%.

Herron was concerned when the economy shut down during the coronavirus pandemic and he's still "pretty concerned" about the effects.

"We just have never seen anything like this where everything shuts down completely," he said. "The industry shuts down. The economy shuts down. I was concerned. I'm pretty concerned still because I think that we are just seeing some of the results of this."

khall@detroitnews.com

Twitter: @bykaleahall