Cash and cars for auto workers who resign from GM, Chrysler

03 February 2009

General Motors and Chrysler, which are borrowing $17.4 billion from the federal government and have until mid-February to show that they can be viable, are offering more buyouts and early retirement packages to factory workers this week as they rush to cut labour costs.

Nearly all of the two companies' hourly workers, about 62,000 at GM. and 28,600 at Chrysler, will be eligible for the offers, which are less generous than the packages used to cut tens of thousands of jobs since 2005.

GM will offer its American hourly workers $20,000 in cash and a $25,000 voucher to buy a vehicle as an incentive to retire or leave the company, an official with the United Auto Workers union briefed on the plan said. Chrysler's programme offers retirement-eligible workers $50,000 in cash and a voucher of $25,000 for a new Chrysler vehicle if they leave.

Workers who opt to leave Chrysler with no retiree health care benefits would get $75,000 and a $25,000 car voucher.

GM detailed its offers in an e-mail message to local union officials Monday. Chrysler made its offers Friday to all hourly workers represented by the United Auto Workers except those at the company's Kenosha, Wisconsin, engine plant. Workers at both companies have until 25 February to accept the offers.

According to the memo from UAW vice president General Holiefield to local presidents and other officials, the union negotiated for another round of offers at Chrysler because of conditions the federal government imposed on the company in exchange for granting the loans.