YUMA, AZ (AZ Family) — Two of America’s largest automakers have announced the closure of two legacy testing facilities in Arizona, amid significant restructuring and layoffs in recent weeks.

The auto industry is facing a significant decline in sales amid increased competition from Asian automakers, persistent inflation and a tight supply chain.

GM’s Desert Proving Grounds is closing in Yuma

GM announced Friday that it is laying off about 1,000 workers worldwide as it seeks to cut costs in an industry that has been tumultuous in recent years.

Although the layoffs were largely seen as impacting “mostly white-collar” workers, Family Arizona learned that those impacts affected Yuma County, which resulted in the layoff of 33 workers at GM’s Desert Proving Grounds .

“To win in this competitive market, we must optimize for speed and excellence. That includes operating with efficiency, making sure we have the right team structure and focusing on our core priorities as a business,” said Kevin Kelly, senior director of corporate relations at GM.

Last April, the Associated Press reported that about 5,000 GM workers at General Motors took purchase offerswhich the automaker said at the time was enough to avoid layoffs.

GM has approximately 150,000 employees worldwide, the vast majority of whom are located in the Detroit suburb of Warren, Michigan. According to the AP, at the end of last year, the company had 76,000 employees worldwide.

At the time, GM said it could not completely rule out layoffs in the future, saying “involuntary separations are not being considered at this time.”

Stellantis is selling its Mohave County facilities

At the end of September, Stellantis, the fourth largest car manufacturer in the worldsaid it is working on changing the North American market.

Recent financial earnings have shown lackluster conditions, likely caused by oversupply, poor pricing strategies and continued labor concerns. The company reported that it expects to end 2024 with a negative cash flow of approximately $11 billion.

Stellantis’ third-quarter earnings fell 27% as it worked to clear high inventory in the United States. Additionally, the company reported that revenue in all regions except South America suffered double-digit declines.

The Arizona family confirmed with the automaker that its Arizona proving grounds were being put up for sale as part of a cost-cutting measure.

According to CNBC, the land covers about 4,000 acres Yucca, Arizonasince Stellantis bought it from Ford in 2007 for $35 million.

“The company is working with the UAW to offer employees at the proving ground special packages or they can choose to follow their work in a transfer of operations. Alternatively, employees could be furloughed indefinitely, which would entitle them to pay and benefits for two years,” Stellantis spokeswoman Jodi Tinson said in a statement to Arizona’s Family.

As part of these changes, CNBC reported that the automaker plans to use Toyota Lands in Wittman, Arizonaabout 45 miles northwest of metro Phoenix.

“Stellantis continues to seek opportunities to improve efficiency and optimize its footprint to ensure future competitiveness in today’s rapidly changing global marketplace,” Tinson said.

Last week, Arizona’s Family sister station in Ohio, WTVG, reported that about 1,100 workers are being cut at a Jeep plant in Toledo.

“It’s been a year full of surprises,” said Kirk Hoddinott, a worker at that plant. “It’s later in life to start a new career, and the thought of having to start a new career now is not a warm feeling at all.”

In Italy, a Stellantis executive said the company has no plans to close any plants in that country, despite Italian vehicle production hitting its lowest level in 60 years. Reuters reported.

Market analysts see a potential rebound in the auto market as retail sales continue to grow compared to 2023 and as auto loan rates begin to decline by early 2025. But for General Motors and Stellantis — the signs of a turnaround have been too late to be avoided. job cuts.,

The Associated Press contributed to this report.

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