GM shrinking hourly ranks

December 14, 2010

GM shrinking hourly ranks

Automaker offering buyouts, early retirement to skilled-trade workers at 14 of its U.S. plants

The Detroit News

General Motors Co. said Monday it is offering $60,000 buyout and early retirement packages to skilled-trade workers at 14 plants because the automaker has 2,500 to 3,000 more of the highly trained workers than it needs.

This is the first time GM has used generous incentives to persuade hourly workers to leavethe company since the automaker emerged from bankruptcylast year.

Eight of the 14 plants targeted for the offers are in Michigan, and include Orion Assembly, where workers will start production next year on the new subcompact Chevrolet Sonic, the successor to the Chevy Aveo.

Workers who take the buyout or retire early must leave their jobs by March, said GM spokesman Chris Lee. Those who take buyouts — younger, less-tenured workers — will give up their retirement benefits for the $60,000 payout; those who take early retirement will get the cash and retain full retirement benefits.

The offers will go out by Dec. 23, but Lee said the number of workers who will get them is not yet clear.

Nine of the plants where skilled workers will get the option to leave are closed or scheduled to close; two others, Spring Hill Assembly in Tennessee and Janesville Assembly in Wisconsin, are on standby. The other eligible factories in Michigan are Grand Rapids Stamping, Livonia Powertrain, Pontiac Stamping, Pontiac Assembly, Willow Run Powertrain, Grand Blanc Weld Tool Center and Flint North Powertrain.

Lee said GM has used early retirement incentives and buyout offers to pare down its workforce in the past, but this time, the automaker is taking a more targeted approach by limiting it to 14 plants, most of which are either closed or slated to close.

GM has about 53,000 skilled trade and production workers at its U.S. plants.

Skilled trade workers include electricians, welders and other trades that require special training. The jobs are often less physically demanding than typical assembly line jobs, and are better paid.

The move comes as GM seeks to add hourly workers at other plants where it’s ramping up new vehicle production. GM also said last month it plans to add 1,000 engineers to its electric vehicle program, as it tries to expand its expertise in this technology.

The automaker is on track to make its first yearly profit since 2004, and auto sales industry-wide are on the upswing, after falling last year to their lowest levels in 40 years. Despite the next year’s rosier outlook, GM says it is working hard to contain costs and keep vehicle production levels in line with how quickly its car and trucks are moving off dealer lots.

GM’s hourly labor costs have fallen along with its work force, from $16 billion in 2005 to $5 billion this year, due in part to cuts made as part of its bankruptcy restructuring.

The United Auto Workers union agreed to slash starting wages and benefits for newly hired workers to $14 an hour.

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