Well in the large industrial town of Detroit, Michigan, it looks like GM workers are getting a real life dose of “The Last of Us”. In short, General Motor HR people woke up this morning, looked themselves in the mirror while muttering “I’m a big, bright shining star” (Boogie Nights if you didn’t know) as they planned to cut 1,000 of its workers straight out of the workplace. 

(Source: Instagram) 

The target? The software and services department. This so-called strategic move follows GM’s comprehensive review aimed at streamlining more of its operations within the departments. See: So AI isn’t taking our jobs? 

(Source: CNBC) 

This whole decision sprung up around six months ago, as Mike Abbot, from Apple, swooped in as the executive vice president of GM”s software and services. However, before he could even hang his diploma, he was out—citing health reasons. (Cue your favorite conspiracy theory.) Abbott’s blink-and-you-miss-it tenure left everyone wondering just where GM’s software dreams were headed.

(Source: Reuters) 

Then as luck would have it, Baris Cetinok and Dave Richardson, became the new software sheriff’s in town with one goal: “Simplifying speed for excellence”. Now of course, this is obviously the latest trend as automakers like Stellantis and Ford have also cut thousands of jobs due to fears over potential downturns from pouring cash into the struggling EV industry (including software-defined vehicles or SDVs). 

(Source: CNBC) 

But, while GM’s stock in general has had a stellar year, up 27.82% YTD, the cuts apparently (representing about 1.3% of GMs workforce), are only in effort to realign the company’s focus on software monetization and recurring revenue opportunities. 

Which for GM is the big opportunity here, as the company has identified software as a critical area for growth, particularly through services like subscriptions that can enhance profitability beyond traditional vehicle sales.

(Source: PYMTS) 

But again, given their recent earnings, once again beating estimates by a mile, it still leaves a head scratcher as to why they are going to these lengths of getting rid of a workforce that’s already outperforming. 

For instance, GM’s latest earnings that were reported on July 23rd were nothing short of impressive. Because while analysts were only expecting $2.70 from the company, GM handed them $3.06 for a whopping +13.39% beat. 

(Source: Alpha Street) 

Revenue came in hot as well with a nice 5.88% surprise as GM raked in $47.97 billion, topping analysts estimates of $45.31 billion. “Ok but what about year-over-year?” Glad you asked: The trailing 12 months looked even more optimistic for the automaker as revenue, net income, and operation income all jumped +7.2%, +14.3%, and 37.59% respectively. 

(Source: Yahoo Finance) 

So clearly, the lights aren’t going out for the company, and the CEO isn’t at risk of being a victim of any hostile takeover anytime soon. Meaning, they are becoming the epitome of a “try-hard” when it comes to elusiveness and speed. 

Now with that said, let’s not forget that the company has dealt with software-delays in the past with some of its EV rollouts, like the highly anticipated Silverado. However, sales are still up… and nobody is crying in the bathroom as of now. 

(Source: Industry Week) 

So in the end, as GM’s stock continues roaring on its current uptrend, it will be interesting to see what kind of impact this slim fast workforce will do for the company's output. Now only time will tell, but given the impressive financials and the fact that 16 out of 17 of our Stocks.News technical indicators are positioned in the “Strong Buy” section - this reduced workforce should only impact the company positively as we head into the fourth quarter. 

In the meantime though, while investors take another look at GM to decide if it’s really worth buying or not… let’s all pour one out for our comrades in Detroit. Life sucks sometimes, and you never know when you’ll be next on the chopping block. 

(Source: Giphy) 

At the time of this writing, General Motors is up +0.61% on the day, and up +27.71% YTD. 

Stocks.News holds positions in the Ford Motor Company as mentioned in the article.