Héctor Villarreal, President of GM Korea. (Image courtesy of GM Korea)
SEOUL, May 29 (Korea Bizwire) — General Motors’ South Korean unit has announced plans to sell off domestic service centers and production facilities, fueling renewed speculation that the Detroit-based automaker may be preparing to wind down its presence in the country.
On Thursday, GM Korea informed employees of its decision to divest nine company-owned service centers and begin the process of selling underutilized land and facilities at its Bupyeong plant, citing operational efficiency and long-term sustainability.
Hector Villarreal, president of GM’s Asia-Pacific operations and GM Korea, said the move aims to “maximize the value of idle assets and rationalize loss-making services,” adding that securing financial sustainability in a rapidly evolving auto industry will require broad stakeholder consultation.
The announcement came on the same day GM disclosed an $888 million investment into its Tonawanda engine plant in Buffalo, New York. The funding will boost production of sixth-generation V-8 engines used in pickup trucks and SUVs, and is expected to create or retain 870 jobs, according to New York Governor Kathy Hochul.
GM’s pivot back to internal combustion engine (ICE) investments follows a broader reassessment of its electric vehicle (EV) strategy amid slower-than-expected global demand. The shift also aligns with a policy climate in the U.S. that has seen decreased momentum for EV mandates and increased political support for domestic manufacturing.
GM Korea (image: Yonhap)
Previously, GM had committed $300 million to convert the Tonawanda facility for EV drivetrain production, but that plan has since been shelved in favor of the much larger ICE investment — a move analysts view as a major strategic recalibration.
Industry observers note that GM has a pattern of withdrawing from markets where profitability is in question. The automaker has exited operations in Australia, Indonesia, Thailand, Europe, and India over the past decade, and shuttered its Gunsan plant in South Korea in 2019 due to similar concerns.
The latest asset sales come at a sensitive time, just ahead of wage negotiations with GM Korea’s labor union — which reportedly was not consulted in advance — further stoking fears of an eventual pullout.
“With over 90% of GM Korea’s output exported to the U.S., the plant essentially serves American interests,” said one auto industry insider. “If tariffs reduce that value proposition, a withdrawal is not out of the question. Management may deny it, but these are ominous signs.”
The developments underscore growing tensions between GM’s global restructuring priorities and the future viability of its South Korean operations.
Kevin Lee (kevinlee@koreabizwire.com)
