hoot
06-07-2005, 11:09 AM
General Motors will cut at least 25,000 employees at U.S. assembly plants over the next three years, GM Chairman Rick Wagoner told shareholders at GM's annual meeting Tuesday.
Cost reduction and capacity utilization is essential for GM to turn around its North American operation, Wagoner said.
"In order to achieve full capacity utilization based on conservative volume planning scenarios, we expect to close additional assembly and component plants over the next few years," Wagoner said, "and to reduce our manufacturing employment levels in the U.S. by 25,000 or more people in the 2005 to 2008 period."
Wagoner said those actions will generate annual savings of approximately $2.5 billion.
No other specifics were provided.
Wagoner also said that GM in recent weeks has been in "intense discussions" with the UAW on a "cooperative approach to significantly reduce our health care cost disadvantage.
"We have not reached an agreement at this time, and to be honest, I'm not certain we will," he said.
This year, GM investors have seen their shares fall to the lowest price in more than a decade as the automaker's market share has slipped and GM's bond rating has been cut to junk, or noninvestment grade, status by two ratings firms.
GM's losses topped $1 billion in the first quarter, and sales for profitable, high-margin SUVs have slumped.
Cost reduction and capacity utilization is essential for GM to turn around its North American operation, Wagoner said.
"In order to achieve full capacity utilization based on conservative volume planning scenarios, we expect to close additional assembly and component plants over the next few years," Wagoner said, "and to reduce our manufacturing employment levels in the U.S. by 25,000 or more people in the 2005 to 2008 period."
Wagoner said those actions will generate annual savings of approximately $2.5 billion.
No other specifics were provided.
Wagoner also said that GM in recent weeks has been in "intense discussions" with the UAW on a "cooperative approach to significantly reduce our health care cost disadvantage.
"We have not reached an agreement at this time, and to be honest, I'm not certain we will," he said.
This year, GM investors have seen their shares fall to the lowest price in more than a decade as the automaker's market share has slipped and GM's bond rating has been cut to junk, or noninvestment grade, status by two ratings firms.
GM's losses topped $1 billion in the first quarter, and sales for profitable, high-margin SUVs have slumped.