GM Buyouts, Pt. 1: 19k Flee Sinking Ship
GM has been trying to realize savings from its two-tier wage agreement with the UAW by offering veteran hourly workers (who are locked in at old wages) cash buyouts to walk from their jobs. Well, the offer has expired and the Detroit News reports that some 19k UAW workers, or nearly a quarter of the General's North American work force, has taken the money and run. Although GM hadn't set a public goal for the buyouts, the 19k number was at the high end of UAW President Ron Gettelfinger's 5k to 20k estimate, and far exceeded Ford and Chrysler's most recent buyout takes. About 4,200 workers took Ford's latest buyout offer, about half of what the blue oval wanted. Chrysler's recently bought out about 7k workers, bringing it to nearly 80 percent of its hourly headcount reduction goal. But GM had to work hard to convince so many of its 46k workers who are eligible for retirement to walk away. The General offered $62,500 to each retirement-eligible worker, who then had the choice of receiving cash upfront or rolling payments into an IRA account, on top of full pension and retirement benefits. And while the carrots for leaving GM were good, the sticks are still looming for those left behind. Ominous reports from Automotive News (sub) tell of GM's "top managers working on additional restructuring measures to deal with a declining U.S. auto market." An anonymous source tells AN that GM plans to cut shifts at truck and SUV plants, cut about 2k salaried jobs through involuntary firings ( sound familiar?), and is considering "other actions." Gee, retirement is starting to sound pretty nice, eh?
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