June 28, 2006
35,000 GM hourly employees participate in attrition program
Detroit, Michigan – General Motors Corporation has announced that approximately 35,000 hourly workers in the U.S. have agreed to participate in an accelerated attrition program, part of GM’s turnaround of its North American operations.
Coupled with the hourly workforce reduction of 6,500 in 2005 and estimated replacements, GM expects to reach its target of reducing 30,000 manufacturing jobs by January 1, 2007, about two years ahead of the previously-announced schedule.
The accelerated attrition program was announced in March. Based on preliminary numbers, approximately 4,600 of the participating employees accepted buyouts, and 30,400 chose to retire. It is expected that most will retire or leave the company by the end of the year. These numbers do not include Delphi employees, who are participating in similar attrition programs.
As a result of the program, GM is increasing its targeted reduction in structural costs in North America to at least US$8 billion, from US$7 billion, on an annual running rate basis by the end of 2006. Approximately US$5 billion in savings is expected to be realized in 2006. Structural costs, such as the cost of unionized employees, are those operating costs that do not vary with production, and include all costs other than material, freight, and policy and warranty costs.