GM buyouts coming early
GM buyouts coming early
Automotive News | January 14, 2008 - 4:04 pm EST
DETROIT — General Motors is getting a head start on its employee buyout program.
Hourly workers represented by the UAW have been retiring since Sept. 30, with a promise that they will receive a $35,000 incentive to leave.
About 70 workers at GM’s Lansing Grand River assembly plant have retired under the plan, although the provisions of the next big GM buyouts have not been announced, said Chris “Tiny” Sherwood, president of UAW Local 5960 in Lansing, Mich.
GM’s announcement could come as early as next week. CEO Rick Wagoner confirmed that on Sunday, Jan. 13.
Lansing workers, who were eligible to retire with 30 years of service, will get their payout when GM formally launches the program, Sherwood said.
GM is not revealing how many workers it expects to take the buyout during the upcoming round, said GM spokesman Dan Flores.
"It’s a voluntary program," Wagoner told reporters here at the auto show. "The percentage of those who go will be dependent on the market."
About 21,000 of GM’s 72,000 UAW-represented workers are eligible to retire with 30 years of service, Flores said.
GM wants retirement-eligible workers to take the buyout so the carmaker can replace them with so-called tier-two workers earning half the wages and benefits of veteran employees. The new Detroit 3 contracts with the UAW pave the way for lower compensation for new hires.
During the last attrition program in 2006, GM coaxed about 35,000 UAW members to retire or take a buyout. The provisions of the last buyout called for a $35,000 pretax payment for workers who retired with 30 years or more service. Workers with 27 to 29 years of service were offered early retirement with almost full retirement benefits until they received full benefits after 30 years.
GM also offered a buyout of $140,000 to workers with 10 or more years of service and $70,000 to workers with less service who agreed to relinquish further GM retirement benefits.
