GM offers to buyout 18000 workers in North America

03 November, 2018, 07:17 | Author: Eric Barnett
  • GM Offers Buyouts to 18,000 Workers, Months After Warning About Layoffs Over Trump's Tariffs

Those who take the buyout have until the end of the year to continue with GM, with severance effective January 1. The figure represents around 36 percent of GM's salaried workforce.

The largest American automaker announced a voluntary job reduction program to staff after reporting strong earnings for the just completed quarter.

GM reported third-quarter net income of $2.53 billion, or $1.75 a share, compared with a loss past year of $2.98 billion, or $2.03 a share.

About 18,000 of the company's 50,000 salaried employees in North America are eligible for the buyouts, the company spokesman said.

Employees who are eligible for the buyout have until November 19 to decide. The company expects to spend $1 billion on Cruise this year. The buyouts do not affect hourly workers at GM's assembly plants.

Morrissey wouldn't say if GM will begin to lay employees off if too few workers take voluntary buyouts.

Depending on how many workers take the offer and other cost-cutting efforts, Morrissey said, "we'll re-evaluate doing an involuntary program after the first of the year".

Until now, GM had spared its home base from overhead cuts while tearing apart the company overseas during the past five years. GM has said it is aiming to save $6.5 billion in "cost efficiencies" through 2018.

The company strives to continue churning out profits through vehicle sales while, at the same time, investing in new technologies such as electric or autonomous cars.

"We always have the need to acquire new talent". "We're controlling what we can control", Suryadevara said. The company made the offer to salaried workers with 12 or more years of service.

"We've been on a journey to transform the company, both in how we operate the business and in how we lead in the future of mobility", the email explained.

The automaker is making the cuts in response to rising commodity costs, said CFRA analyst Garrett Nelson. She also noted that the company's stock price is still stuck near the $33 a share price at which it debuted in 2010 after a bankruptcy restructuring.

GM has a global salaried workforce of 77,000 people, according to its 2017 annual filing. The Trump administration has imposed 10 per cent tariffs on imported aluminum and 25 per cent on steel.

The automaker says it is performing well, but the industry overall is facing slowing sales in the US and China because of higher steel and aluminum prices due to American tariffs.

GM's US rival, Ford (F), said in early October that it plans to thin the ranks of its salaried workforce by the second quarter of next year.

Rival Ford also is working to reduce its salaried workforce. Ford has not provided specifics on how many jobs will be cut as part of its $11 billion "fitness" plan.



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