YUMA, AZ (AZFamily) — Two of the largest U.S. automakers have announced the closure of two aging testing facilities in Arizona amid significant restructuring and layoffs in recent weeks.

The auto industry is facing a significant decline in sales amid increased competition from Asian automakers, persistent inflation and a tight supply chain.

GM’s Desert Proving Grounds ends in Yuma

GM announced Friday that it would lay off about 1,000 workers worldwide as it tries to trim costs from an industry that has been in turmoil in recent years.

Although the layoffs were largely billed as affecting “mostly white-collar workers,” Arizona’s family has learned that the effects hit Yuma County, which led to the layoffs of 33 workers at GM’s Desert Proving Grounds.

“To win in this competitive market, we must optimize for speed and excellence. This includes working with efficiency, ensuring we have the right team structure and focusing on our highest priorities as a company,” said Kevin Kelly, senior director of corporate relations at GM .

Last April, the Associated Press reported that about 5,000 GM officials at General Motors took purchase offerswhich the automaker said at the time was enough to avoid layoffs.

GM has approximately 150,000 employees worldwide, the vast majority of which are located in the Detroit suburb of Warren, Michigan. According to the AP, the company had 76,000 employees worldwide at the end of last year.

At the time, GM said it could not completely rule out layoffs in the future, saying “involuntary separations are not a consideration at this time.”

Stellantis is selling its facilities in Mohave County

At the end of September, Stellantis, the world’s fourth largest car manufacturersaid it was working to turn around the North American market.

Recent financial earnings indicated difficult conditions, likely driven by oversupply, poor pricing strategy and ongoing labor concerns. The company reported that it expected to end 2024 with a negative cash flow of about $11 billion.

Stellanti’s third-quarter earnings fell 27% as it worked to clean up high inventory in the US. Additionally, the company reported that revenue in all regions, except South America, suffered double-digit declines.

Arizona’s family confirmed with the automaker that its Arizona Proving Grounds was up for sale as part of a cost-cutting measure.

According to CNBC, the land covers about 4,000 hectares in Yucca, Arizonasince Stellantis bought it from Ford in 2007 for $35 million.

“The company is working with the UAW to offer proven ground employees special packages or they can choose to follow their work in a transfer of operations. Alternatively, employees could be furloughed indefinitely, which would entitle them to pay and benefits for two years,” said Jodi Tinson, spokesperson for Stellantis, in a statement with Arizona’s family.

As part of these changes, CNBC reported that the automaker plans to use Toyota’s proving ground in Wittman, Arizonaabout 45 miles northwest of metro Phoenix.

“Stellantis continues to look for opportunities to improve efficiency and optimize its footprint to ensure future competitiveness in today’s rapidly changing global marketplace,” said Tinson.

Last week, Arizona’s family sister station in Ohio, WTVG, reported on it 1,100 workers cut at a Jeep factory in Toledo.

“It’s been a whole year of surprises,” said Kirk Hoddinott, a worker at that plant. “It’s later in life to start a new career, and the thought of having to start a new career now is not a warm feeling at all.”

In Italy, a Stellantis executive said the company has no intention of closing any factories in that country despite Italian vehicle production being the lowest in more than 60 years. It was reported by Reuters.

Market analysts see a potential recovery in the auto market as retail sales continue to increase compared to 2023 and as interest rates on auto loans begin to fall into early 2025. But for General Motors and Stellantis, signs of a turnaround were too late to avoid cuts.,

The Associated Press contributed to this report.

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