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· Posted on
August 21, 2024

General Motors cuts 1,000 software jobs as it accelerates toward AI - and that's what we call a high-tech tune up

General Motors has announced that it will be laying off 1,000 staff in its software and services division.

What's the key learning?

  • Various industries have already been exploring the possibility of integrating AI into its products and services.
  • Mass layoffs from different companies have also been reported mainly due to restructuring to pave way for AI, according to Bloomberg.
  • So it's no surprise that the automotive industry is also dabbling into this trend especially with the possibility of opening a new revenue stream for its businesses.

👉 Background: General Motors is the American car manufacturer that’s been around since 1908 and owns brands like Chevrolet, Hummer, Saab, and the classic Aussie Holden (#RIP).

👉 What happened: General Motors has announced that it will be laying off 1,000 staff in its software and services division. These job cuts are a way to make software and AI more central to its vehicles.

👉 What else: This comes after General Motors encountered some software glitches in its new Blazer EV late last year and had to pause sales on it. So now, General Motors is resetting itself to better compete with other carmakers in an industry that’s becoming increasingly software-driven.

What's the key learning?

💡In the automotive industry, software is the new hardware. Think: heated seats, driving assistance features, fast charging for EVs - the list goes on.

💡Get this, the average lines of software code per vehicle doubled from 100 million in 2015 to 200 million in 2020, and that number is expected to jump to 650 million by 2025, according to Goldman Sachs.

💡Now, carmakers are realising that they can charge subscription fees for software upgrades and  open up a brand new revenue stream. So General Motors wants in on some of this subscription action.

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