General Motors Corp., the world's biggest automaker, has offered buyout and early retirement packages to some of its nonunion, salaried workforce in North America as the company grapples with cutting costs.
The offers were sent in the first quarter in hopes of speeding the normal amount of attrition the company usually has, Toni Simonetti, general director of financial and international communications, said yesterday in an interview.
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The company has 40,000 white-collar workers in North America, Simonetti said, "and there are areas in the organization that have a greater opportunity to reduce numbers than others."
GM is under pressure from investors to close plants and renegotiate union contracts. Its bonds fell last week to the lowest levels against government debt since at least 2001 after the company forecast its biggest quarterly loss in 13 years. The Detroit company is the third-biggest issuer of corporate debt.
The company has not targeted a specific number of people it hopes will participate, Simonetti said. In 2004, the company had 324,000 workers worldwide and a payroll of $21.5 billion, according to a company filing.
The online edition of the Wall Street Journal reported yesterday the packages and said the cuts may go as deep as 28 percent in certain functions, a number that Simonetti declined to confirm.
The reductions, she said, "will vary from department to department."
The program to reduce non-union headcount "is winding down," Simonetti said. She declined to comment on other steps the company might take if the number of people leaving the company voluntarily is not enough.
With U.S. sales this year headed for the lowest market share in 80 years, GM is finding it tougher to cover rising health care costs for its 1.1 million employees, retirees and dependents and pay for increased costs for steel and other materials.
GM said on March 16 it forecasts a first-quarter loss of about $1.50 per share and a 2005 profit of $1 to $2 per share, less than the Jan. 13 forecast of $4 to $5 a share. Falling U.S. car and truck sales prompted the automaker to deepen cuts in both first-quarter and second-quarter production by at least 10 percent.
