GM to cut salaried workers, production, dividend

General Motors Corp. said Tuesday it will lay off salaried workers, cut truck production, suspend its dividend and borrow $2 billion to $3 billion to weather a severe downturn in the U.S. market.

[mbmom]

Do you suppose CEO Wagoner will take a cut in his pay?

[Florida Jim]

This is all unnecessary if the union and Mgmt. had long ago decided to manufacture autos that were more economical, smaller, less expensive and were able to get 50/MPG. If this had started many years ago both the employees and GM would be on easy street today. The Union asked for more and more and the company gave in time after time while the costs sky-rocketed. The cars and trucks got ever larger and less efficient and the company reduced costs by reducing emplyees
nobody won. GM and the union can still prosper by producing more efficient automobiles, with flex fuel, hybrids that reduce gas usage by 60% and develop more sensible vehicles. If the company and union had long ago developed an incentive system for all employees which rewarded everyone for more profits and more innovation they would not be in this mess.

[mchealth]

Love the term "impatient Wall Street" - perhaps the billionaires on Wall Street would like to throw some of their money into the ring. The economy is going to take some time to recover - no amount of "impatience" is going to make it improve faster or better

[moquif]

mbmom wrote:

Do you suppose CEO Wagoner will take a cut in his pay?

That's what I'm wondering. If they're going to cut workers, shouldn't they also cut the management too? How many people up top take a cut in pay or give up their bonuses over this? Also if GM is going to break its word to retirees, shouldn't they also break their word in how much severance pay CEOs get?

[jschmo]

why not make quality cars instead of the plastic crap? Maybe, just maybe that will help their sales.

[GMM]

Colin wrote:

<quoted text>
Just making sure, do you hold the same contempt for Range Rovers and Lexus LX 470s? They get just as bad or worse MPG and cost more to buy.

They're not GM products; that's why she didn't comment on them.

[Neighbor to the North]

Colin wrote:

<quoted text>
Just making sure, do you hold the same contempt for Range Rovers and Lexus LX 470s? They get just as bad or worse MPG and cost more to buy.

Yep, I do, when they're blocking views at intersections and being driven to the dry cleaners' and the spa with just one person inside. When they are hauling horse trailers or boats or are loaded with six kids and the family Rottweiler, I have more compassion for them -- no way that family is going anywhere in a Corolla.

As someone who drives a car -- who had that car before SUVs became commonplace -- my biggest beef is the disparity they create in traffic with regards to visibility. I can't see to turn left because there's one ahead of me in the opposing turn lane, and I've got another one behind me honking because he can see around the other one just fine, and HE knows it's clear to go but I'm not trusting his judgment! The disparity in fuel economy between SUVs and passenger vehicles really is secondary for me. Heck, there are hybrid SUVs that get pretty good fuel economy -- but I *still* can't see around 'em in traffic!

[The Boss]

Now Main Street's white washed windows
and vacant stores
seems like there ain't nobody
wants to buy SUV's no more
They're closing down the auto plant across the railroad tracks
Foreman says these jobs are going boys and they ain't coming back
to your hometown

[BillHill]

This comes about 5 years too late. Paying for retirees medical is a nice gesture, but certainly was not a good businesses move since health care costs have been rising consistently for the last 20 years. Cutting jobs is a good move, but cutting wages across the board would be more prudent. A nice pay cut for management and maybe tie it to a strong incentive based salary structure would be more prudent.

[Iacocca]

As GM goes - so goes the country.

[I hate SUVs]

A day late and a dollar short.
Hardships imposed on their employees caused by greed and lust in the SUV market. I would say just desserts to GM, but it's the employees who get hurt, not the vips.
So now looking at alternatives, like it's a good idea, huh? Well, you guys are about 20 years late. Disgusting.

[John]

Im kind of SOL myself, i will alawys have to drive a big vehicle. Why you ask? Two things one, like many americans i am very tall 6'7", Two, I like power, a Big V8 Feels good.
GM is getting with the times, but if people WANT To own hummers, Suburbans, Dodge vipers, why stop them from paying more?

[joe]

Florida Jim wrote:

This is all unnecessary if the union and Mgmt. had long ago decided to manufacture autos that were more economical, smaller, less expensive and were able to get 50/MPG. If this had started many years ago both the employees and GM would be on easy street today. The Union asked for more and more and the company gave in time after time while the costs sky-rocketed. The cars and trucks got ever larger and less efficient and the company reduced costs by reducing emplyees
nobody won. GM and the union can still prosper by producing more efficient automobiles, with flex fuel, hybrids that reduce gas usage by 60% and develop more sensible vehicles. If the company and union had long ago developed an incentive system for all employees which rewarded everyone for more profits and more innovation they would not be in this mess.

You Sir are a Maroon...

They didn't build small fuel sipping cars because nobody would have bought them, and this news of extreme downsizing would have been announced long ago. We are all to blame, as the american consumer is too shortsighted to .. ah heck. forget it. Just enjoy your small car and hope your neighbors do the same.

[LCK]

Florida Jim wrote:

This is all unnecessary if the union and Mgmt. had long ago decided to manufacture autos that were more economical, smaller, less expensive and were able to get 50/MPG. If this had started many years ago both the employees and GM would be on easy street today. The Union asked for more and more and the company gave in time after time while the costs sky-rocketed. The cars and trucks got ever larger and less efficient and the company reduced costs by reducing emplyees
nobody won. GM and the union can still prosper by producing more efficient automobiles, with flex fuel, hybrids that reduce gas usage by 60% and develop more sensible vehicles. If the company and union had long ago developed an incentive system for all employees which rewarded everyone for more profits and more innovation they would not be in this mess.

Fact is that in '87 i saw GMs hybrid at a show in Detroit and talked to one of the engineers. It was a two seater and looked great. They had all this time to perfect it and get it to market, but greed rules out and now people are paying for it with loss of jobs. The unions and the auto industry also have to share the blame on all of this. They have all these sweet heart deals they have and the auto industry buckled down to.

[John]

Time for the trucks and SUV's to be reduced. Hopefully, they do re-tool these lines to manufacture smaller, fuel efficient cars. I have no bias towards anyone who truly needs a truck or SUV for their job. SUV's and Mini-Vans do have a purpose for families. But, it is time to re-adjust our perception of them as status symbols. If you live in a rural area, there is a good chance that a truck is necessary. However, I have to believe that having a second fuel efficient car is a good idea for daily small trips.

This creates an opportunity for this manufacturer to get it right again. Go cutting edge, at a reasonable price, and put US Manufacturing back at the lead. Will they do it? Time will tell.

For the retirees, I hope the pension increase is enough for them to now purchase the supplemental insurance they will now need. That, to me , is the worst of this. People who worked and earned their retirement benefits having to adjust. At a time, when they should be able to relax, this adds a new worry and expense for them.

Pay adjustments from the top down with performance incentives is an idea they should follow up on.Even though executives have their golden parachutes, I wonder if they really want to be remembered for destroying a great American company.

[John]

John wrote:

Im kind of SOL myself, i will alawys have to drive a big vehicle. Why you ask? Two things one, like many americans i am very tall 6'7", Two, I like power, a Big V8 Feels good.
GM is getting with the times, but if people WANT To own hummers, Suburbans, Dodge vipers, why stop them from paying more?

Unfortunately, this would not help us in reducing oil independence. Most likely, if you can afford a Suburban, Hummer or Viper, gasoline cost is not a concern to you. That may not be true in all cases. I like a fast, powerful car as much as anyone. It's just not reasonable from an economic standpoint for me at this time.

[Robbie]

Excellent news,GM has shot it self in the foot by screwing their customers for years,now either produce quality cars or go out of business.And how will soccer mom with a baby and a small dog drive to Target with out Tahoe or Escalade being produced ?

[Crew Dude]

Thanks UAW!

[Kay S]

Having worked for one of the GM divisions for many years I can say the situation they are in today is a combination of a lot of factors. Yes, some was stubborn resistance on the part of GM (and Ford and Chrysler, too for that matter!) to listen to their dealers as to what the people - their customers - wanted in their new cars. Another big problem was the work rules imposed by the unions. Their ability to shut down an entire plant of some of the silliest things you ever heard forced the companies to buy labor peace by giving in to a lot of really stupid ideas. Since the foreign imports coming in were not subject to the same union work rules, those manufacturers could get on with other things within their corporate system.

The United Auto Workers picks the most vulnerable of the Big Three Auto Makers every three years to be their "target" for a strike and to negotiate the new contracts; then the other two pretty much have to follow suit. It is NEVER a negotiation to the positive --- it is ALWAYS to the negative, and since the laws that govern negotiation all favor the unions we get the problems we have today.

So who is to blame? There is enough to go around, but if people are asking about the reduction needed in salary and bonus for the GM Brass, how about the needed reduction in Union Dues and the pay for the union big-wigs? Have you ever seen the huge buildings in Washington D.C. owned by the union so they can LOBBY Congress? Take a look some day.....

But the saying is still true - AS G.M. GOES, SO GOES THE NATION!!!

[Paul]

Neighbor to the North wrote:

<quoted text>
Yep, I do, when they're blocking views at intersections and being driven to the dry cleaners' and the spa with just one person inside. When they are hauling horse trailers or boats or are loaded with six kids and the family Rottweiler, I have more compassion for them -- no way that family is going anywhere in a Corolla.
As someone who drives a car -- who had that car before SUVs became commonplace -- my biggest beef is the disparity they create in traffic with regards to visibility. I can't see to turn left because there's one ahead of me in the opposing turn lane, and I've got another one behind me honking because he can see around the other one just fine, and HE knows it's clear to go but I'm not trusting his judgment! The disparity in fuel economy between SUVs and passenger vehicles really is secondary for me. Heck, there are hybrid SUVs that get pretty good fuel economy -- but I *still* can't see around 'em in traffic!

Not to mention the arrogance that SUV drivers seem to posess. They think they are "special" because they are bigger. Nope.