Tech and Auto Giants Restructure for the AI Era... Foreign Media Focuses on Massive Job Cuts at Cisco and GM

As corporate investments in artificial intelligence (AI) innovation recently accelerate, information technology (IT) and automotive industry giants Cisco and General Motors (GM) have embarked on large-scale workforce restructuring. Major foreign media outlets are competitively reporting on their moves to respond to the rapidly changing market by cutting their existing workforce and instead bringing in talent equipped with specialized AI capabilities.

Cisco Draws the Sword Despite Strong Earnings... Media Also Highlights 'Focus on AI and Security'

According to a report by The Wall Street Journal (WSJ), Cisco, a leader in the network market, plans to carry out massive workforce reductions to accelerate its AI transition. In fact, despite achieving record revenue of $15.8 billion, a 12% increase year-over-year in the third quarter of fiscal year 2026, Cisco announced that it would lay off about 4,000 employees, which corresponds to less than 5% of its global workforce.

Foreign media paid attention to Cisco's mixed performance and actions. CNBC reported that although Cisco's stock price surged by 17% due to a spike in AI orders, the company would drastically cut jobs. Reuters also analyzed that despite the surge in orders, Cisco is planning layoffs as part of an AI-centric restructuring, and SFGATE reported on the paradoxical situation of a Bay Area tech giant laying off thousands of employees after recording its highest-ever revenue.

Regarding the layoffs, Cisco CEO Chuck Robbins explained, "It was a difficult decision to focus our resource investments on key growth areas with the highest demand and value creation, such as AI and security." Cisco has already secured $5.3 billion in AI infrastructure orders this year alone, and plans to provide severance pay and outplacement support programs to the affected employees.

GM Undertakes "Skills Swap"... The Hidden Side of Sudden Layoffs Reported by Foreign Media

The situation is similar for GM, the largest automaker in the United States. Major media outlets continued to report on the repercussions of AI restructuring hitting the automotive industry. TechCrunch analyzed that GM laid off hundreds of IT workers to hire personnel with stronger AI skills, while CNBC vividly described the ominous meeting details experienced by the laid-off GM employees, the role of AI, and the severance pay situation.

According to the Detroit Free Press, GM is laying off hundreds of IT workers globally, citing the need for new skills. The Detroit News reported that GM is cutting up to 600 white-collar positions even as it continues to seek tech talent, and Yahoo Finance also reported that General Motors' layoffs had a significant impact on its IT employees.

Looking at the reported details, GM laid off around 500 to 600 employees, which is over 10% of its total IT workforce, in locations such as Austin, Texas and Warren, Michigan. Some of the laid-off employees complained that they suddenly received termination notices during a 15-minute video meeting conducted without prior warning. Rather than simple cost-cutting, GM's recent move has a strong nature of a 'skills swap,' and in place of the dismissed existing personnel, the company is still hiring for about 80 IT positions for experts who can handle AI technologies such as AI native development and data engineering. GM plans to pay up to six months of salary as severance pay depending on the years of service.

Acceleration of AI-Centric Workforce Reorganization

The successive news of layoffs at Cisco and GM suggests that regardless of the industry, AI is shaking the corporate workforce structure itself from the bottom up, going beyond being a simple work assistance tool. Going beyond the level of encouraging existing employees to utilize AI, the trend of redesigning organizations centered on talent equipped with fundamental AI development capabilities, such as system design and model training, is expected to intensify further in the future.