The company reported that it will cease its manufacturing activity at the Colmotores plant in Colombia, beginning the dismantling process today.
Through a statement, automotive giant General Motors (which to date has a strong presence in Colombia due to the manufacturing of Chevrolet vehicles) announced that it will cease manufacturing activities in the country at the Colmotores plant.
“Manufacturing operations will cease at the Colmotores de Colombia plant and the disassembly process begins today with a reduced team. At the OBB plant in Ecuador, manufacturing will cease at the end of August 2024,” General Motors reported.
The company explained that this move responds to a transition strategy that will convert Colombia and Ecuador into purely marketing and after-sales services countries. In other words, local work will be reduced to customer service.
General Motors also detailed that this adjustment was necessary in the business vision of “offering customers the next generation vehicles.” The company also pointed out that Colombia's loss of attractiveness for assembly and manufacturing tasks basically responds to the high degree of underutilization of the Colmotores plants, in which only 9% of its installed capacity was being used.
In the case of GM OBB, which is the plant in which it operates in Ecuador, the utilization is 13% of installed capacity.
In other words, not much was being done in both countries.
“The transformation of operations into national vehicle marketing and after-sales service companies aims to respond to the challenges of the growing fragmentation of markets, as well as the underutilization of plants,” General Motors explained.
The company also recognizes the impact its decision has on the national economy, which is why it said it will assist those who will be affected by the loss of their jobs.
“General Motors will maintain its historic presence in Colombia and Ecuador through its Chevrolet brand and its solid network of companies and businesses such as GMICA-Isuzu, GM Financial and Chevyplan, as well as its commercial partners, its extensive network of dealers and the services of OnStar connectivity,” said the firm, concluding that this decision responded to an analysis in which it was determined that ceasing manufacturing in Colmotores was the most sustainable solution for the company.
“After a careful evaluation, we decided that the national company model focused on the marketing of vehicles and focused on the customer is the right path to compete in Ecuador and Colombia in the future. The Company understands the impact that this decision has on employees, which is why it developed a plan to close employment contracts with benefits that are above legal requirements, as well as a broad and solid job relocation program,” said Santiago Chamorro, general director of GM South America
