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Illustration: Sarah Grillo/Axios

GM is laying off 14,300 employees. It's shuttering five factories in the U.S. and Canada, and says that two more closings will be announced internationally. By next year, it will no longer make the Buick LaCrosse, the Chevrolet Impala, or the Cadillac CT6 sedan. It's even killing the Chevy Volt plug-in hybrid.

The big picture: Welcome to the modern car industry, which is full of bad news. All the top-selling sedans in America — the Toyota Camry, Honda Civic, Honda Accord, Toyota Corolla, Nissan Altima, and Nissan Sentra — are Japanese.

  • Why it matters: American carmakers can't compete, and are giving up that segment of the market. Instead they're concentrating on trucks, SUVs, and crossovers, which have higher profit margins and growing demand.

What's next? Almost certainly, even more job losses.

  • Car factories are at their most efficient when they run at full capacity. Right now America is capable of producing many more vehicles than there's demand for — roughly 3.2 million vehicles per year, according to Kristin Dziczek, vice president of industry, labor and economics at the Center for Automotive Research. (GM accounts for about 1 million of that.)
  • The logic of efficiency means that yet more factories are likely to close.

President Trump's trade war and steel tariffs are costing the industry billions, including roughly $700 million in higher steel prices at GM alone. Very few big automakers have avoided problems:

  • Ford has already announced that it is effectively getting out of the car business. By 2020, it will no longer sell the Fiesta, Taurus, Fusion or Focus in North America. Only the Mustang will remain, along with a crossover called the Focus Active.
  • Tesla CEO Elon Musk told "Axios on HBO" that the entire company was "within single-digit weeks" of death — in need of layoffs or new financing — earlier this year.
  • Nissan CEO Carlos Ghosn, after trying to push through a merger with France's Renault that neither company really wanted, is now sitting in a Japanese jail. A Nissan whistleblower told Japanese authorities that Ghosn was being paid tens of millions of dollars in undeclared income. (Wall Street Journal editorial: "The Ghosn Inquisition")
  • Fiat Chrysler is struggling after the death of its charismatic leader, Sergio Marchionne, who never achieved his longstanding dream of merging with GM.
  • Volkswagen, which has also seen a senior executive arrested, has set aside $30 billion to cover costs associated with its Dieselgate scandal.

What to watch: The future of car-making might be grim, but stock market investors are excited about self-driving cars and mobility as a service.

  • That market logic is putting pressure on carmakers to pour billions into R&D. It's also driving strategic investments in everything from AI to electric scooters.
  • The result: A major secular employment shift away from unionized factory workers and Detroit middle-management lifers. Expect the United Auto Workers, still GM's largest shareholder with a $3.6 billion stake in the company, to remain extremely unhappy for the foreseeable future.

Go deeper:

Go deeper

Updated 2 hours ago - Health

First North American Omicron cases identified in Canada

COVID-19 testing personnel at Toronto Pearson International Airport in September. Photo: Steve Russell/Toronto Star via Getty Images

The first two cases of the new Omicron variant have been detected in North America, the Canadian government announced Sunday evening.

Driving the news: The World Health Organization has named Omicron a "variant of concern," but cautioned earlier on Sunday that it is not yet clear whether it's more transmissible than other strains of COVID-19.

6 hours ago - Health

WHO: Not yet known whether Omicron leads to more severe disease

Photo illustration: Pavlo Gonchar/SOPA Images/LightRocket via Getty Images

The World Health Organization on Sunday said that it is not yet clear whether the newly discovered Omicron variant is more transmissible than other strains of the COVID-19 virus.

Why it matters: The agency's statement comes as the variant, discovered in South Africa, has already been detected in European and Asian countries.

11 hours ago - Health

Fauci: Omicron variant will "inevitably" be found in U.S.

Photo: Chip Somodevilla/Getty Images

Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases, cautioned on Sunday that the COVID-19 Omicron variant will "inevitably" be found in the United States.

Driving the news: Fauci, Biden's chief medical adviser, told ABC's George Stephanopoulos on "This Week" that U.S. officials will meet with colleagues from South Africa later on Sunday to try to determine the severity of the cases, as countries scramble to learn more about the variant.

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