General Motors Co. (NYSE: GM) has announced plans to cut 160 jobs from its Kokomo plant. The company, which currently employs more than 755 hourly and salaried employees at the plant, says the cuts are due to a decision to cease semiconductor production by mid-2017.
In a statement, GM says the technical capabilities of its current equipment does not allow it to compete at a global level. The company says it would be cost prohibitive to invest in new equipment to produce semiconductors at the Kokomo plant.
"This is a business decision, as current production volumes do not support a profitable operation," said GM. "As a result of the decision, all UAW/GM employees who currently work at the site will be treated in accordance with applicable provisions in the UAW Local and National Agreements. We will similarly be identifying opportunities and options for affected salaried employees in the upcoming months."
GM says about 600 jobs are expected to remain at the plant. The Kokomo facility also has thick film printing operations as well as electronic assembly of engine control modules, transmission control modules, safety electronics and sensors, among other products, according to the GM website.
Employees were notified of the cuts last week, the same day GM announced it was investing $37 million into its facility in Bedford. The company is in the midst of restructuring plans and has announced more than 2,000 additional job cuts at facilities in Michigan and Ohio.