Embattled US automaker General Motors, racing to restructure to avoid collapse, plans to cut 1,600 white-collar jobs in the next 10 days. Combined with 250 earlier job cuts and other resignations and retirements, the moves will complete ''the bulk'' of GM's plan for eliminating 3,400 US salaried positions, a spokesman, Tom Wilkinson, said today.
''These are difficult actions,'' North America President Troy Clarke wrote in an e-mail to employees. ''However, given the economic realities facing GM, these actions are necessary to help ensure the long-term viability of our company.''
Additional cuts may be coming after new CEO Fritz Henderson said on 17 April that Detroit-based GM would have to get rid of more jobs in order to meet government demands for deeper and faster savings to continue to operate on government aid. GM faces a 1 June federal deadline.
GM, the former world's leading automaker that has been reeling from an auto sales slump amid prolonged US recession, could be forced to file for a bankruptcy court-supervised restructuring if it fails to meet the federal deadline. In an update on its progress in developing the restructuring plan, GM reiterated Friday that it wanted to avoid filing for bankruptcy protection but was preparing for it nevertheless. (See: GM working on new plan to avoid bankruptcy)
The reductions are part of GM's plan to slash its global salaried work force by about 10,000, or 14 per cent, in a bid to cut costs. GM also aims to cut 37,000 hourly jobs worldwide by the end of the year. President Barack Obama's auto task force is tentatively set to meet on 24 April with representatives of salaried retirees from GM, Ford Motor Co. and Chrysler LLC.(See: General Motors to cut 10,000 jobs, reduce salaries as part of turnaround plan)
To date, GM has reduced worldwide headcount this year by 47,000 jobs, including about 26,000 outside the United States, bringing its global workforce to 200,000. In the US, in addition to white-collar jobs, GM has slashed 7,000 factory jobs this year in a voluntary departure program, Wilkinson said.