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00SL2
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All GM workers to get buyout offer
by Rick Haglund | Ann Arbor News Bureau
Thursday January 17, 2008, 9:12 PM
General Motors Corp. will offer buyouts and early retirement incentives to its entire U.S. hourly work force as the automaker expects sales to fall this year in a rapidly weakening economy.
GM said Thursday 40,800 workers now eligible for retirement will be offered special incentives next month to leave the company by April. Another 5,200 workers already have been offered special retirement packages to leave by March.
All of the automaker's 78,000 workers will be offered some type of buyout, GM spokesman Dan Flores said.
GM also might have to cut production at assembly, powertrain and engine plants if the U.S. economy weakens further, Chairman Rick Wagoner said at the Credit Suisse First Boston analyst conference in Dearborn.
"The U.S. isn't the engine for growth in the world right now," Wagoner said. "It is definitely China."
Details still need to be finalized with the United Auto Workers union, but Flores said the buyout packages likely are to be similar to those offered by the automaker in 2006.
Back then, those with 30 years of seniority got $35,000 to retire and received full pensions, while buyout incentives ranged from $70,000 to $140,000, depending on years of service.
GM shed 34,400 hourly workers in that program, but officials said they have no employment reduction target this time.
"There's been a radical change taking place in our traditional markets," Wagoner said.
GM and other domestic automakers are facing intense competition and soft U.S. sales, forcing them to become leaner and more efficient.
Just last week, 200 workers at the company's Ypsilanti Township powertrain plant were laid off amid lower demand for the transmission that the plant makes.
Those indefinite layoffs left total employment at the plant to about 1,800. Another 530 people work at the Ypsilanti Transissions Operations, in the powertrain campus, and 800 are at the Ypsilanti Engineering Center there.
In 2006, 1,135 people took buyouts and left the powertrain site.
Some analysts say U.S. car-and-truck sales could fall to 15.5 million vehicles this year, down from 16.1 million last year.
GM lost $38 billion in the first nine months of last year, mostly due to a massive accounting charge. Its North American auto operations have been operating roughly at a break-even point this year.
The automaker is expected to announce full-year 2007 earnings later this month.
Analysts say GM is likely to replace at least some of its departing workers with new ones making half the $28 an hour current workers earn.
GM said Thursday it expects to save $5 billion in U.S. labor costs by 2011, mostly due to a new labor contract with the United Auto Workers.
That contract establishes a $47 billion trust to pay health care costs for retired UAW workers. It also allows the company to pay "non-core" workers about half the $28 an hour paid to workers whose jobs require them to work directly on vehicles.
GM said the contract allows the automaker to reclassify "a significant number of jobs over time" as non-core.
Wagoner said GM has made much progress over the past two years in cutting costs, improving the styling and quality of its vehicles and helping its largest parts supplier, Delphi Corp., restructure itself in Chapter 11 bankruptcy.
But industry auto sales have fallen by about a million vehicles during that time, forcing GM to cut costs more deeply than it planned.
"We know we have to improve our earnings and cash flow," GM Chief Financial Officer Fritz Henderson said.
Doing so will require the automaker to keep a sharp focus on building high-quality vehicles, such as the Chevrolet Malibu and Buick Enclave, Wagoner said. "That's a top priority in the company," Wagoner said.
Additional reporting by Stefanie Murray, The Ann Arbor News
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Source:
http://www.mlive.com/news/index.ssf/2008/01/all_gm_workers_to_get_buyout_o.html |
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Fri Jan 18, 2008 1:19 am |
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Public D
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Think twice before taking the buy-off:
The Luck of the Short Straw, by Gregg Shotwell
Workers can't afford to save a lot of money when they are trying to raise a family, pay off a house, send children to college, and sponsor weddings. Most workers don't begin to really save for retirement until the children are grown and family obligations are taken care of.
So it isn't until their later years that workers can really afford to set aside much money for retirement. But the auto companies expect us to retire early and sacrifice those final years of maximum earnings without any compensation.
First, they say, “You’re lucky to have a job.” Then, they say, “You’re lucky to retire.”
But retirement at half the income is the luck of the short straw.
Headline: GM workers in Belgium don’t settle for less.
“On 1 July 2007, management reached an agreement with the trade unions on the redundancy settlement for the production workers. Some 1,200 workers over 50 years of age can take early retirement and retain between 82% and 89% of their last net wage. In addition, up to 750 workers will be made redundant. Workers who decide to leave the company voluntarily, having worked at the Antwerp factory for at least 25 years, can claim a maximum gross severance payment of €144,000.” ( 144,00 euros = 213,000 dollars at current exchange rates)
[ http://www.eurofound.europa.eu/eiro/2007/05/articles/be0705029i.htm ]
Apparently, GM treats European workers with more respect than American workers. Perhaps it’s because Europeans have real unions which conduct real strikes in response to company threats. When GM announced that the Antwerp, Belgium plant would not get a new car, workers fought back. Between April 17, 2007 and July 1, 2007 there were six work stoppages and/or strikes including a wildcat at the Antwerp GM plant, plus a three hour solidarity work stoppage by other European GM workers. It pays to fight back.
On top of the rich retirement packages Europeans have guaranteed health care. GM workers in America have a VEBA with co-pays, premiums, and deductibles that can only go up as new hires realize that they have no need to donate COLA diversions to a fund they will never benefit from.
Financial planners estimate that during retirement, you will need 80 – 100 percent of your current income to maintain the same standard of living. If the average GM worker could retire and retain 85% of their income (like GM workers in Belgium) that would equal approximately $53,000 a year, assuming a forty hour week. Given the state of the economy, the lack of decent jobs, the jeopardy of pension plans in the United States, and an underfunded health care plan run by the UAW, retirement looks like a pretty shaky proposition.
If you retire early and don’t have the advantage of earning, and therefore saving, during the final years of your career, you will need a substantial severance package. Unless, of course, you are willing to lower your standard of living 50% in the first year of retirement, and deflate from that point as the cost of taxes, insurance, utilities, and doctor appointments inflate.
If we don’t hear the money talk, we have no reason to walk away from a good paying job.
________________________________
Autoworker Activists Gathering
Saturday, January 26th 2008
Flint, Michigan
“From the Ashes of the Old...”
The Center for Labor Renewal & The Solidarity Education Center
in conjunction with Soldiers of Solidarity, Future of the Union, FactoryRat,
Labor Notes & numerous rank & file committees of resistance
will sponsor a one-day meeting for all autoworker activists on the recent concessionary Big Three Auto Contracts. The session will be an opportunity to analyze the economic & structural impact of the negotiations, to share experiences from the effort to mobilize opposition, and explore strategies and tactics for reclaiming unionism’s direction and rebuilding rank & file solidarity.
Location: University of Michigan-Flint
Harding Mott University Center - Michigan Rooms A & B
On Circle Dr. off Kearsley Street (Bldg # 10 on campus map)
9:00 am - 5:00pm
http://www.csc.flint.umich.edu/~hickslm/umf/CampusMap.htm
For those coming from some distance and needing overnight accommodations, reduced rate rooms are available at the Holiday Inn adjacent to the campus. For reservations at the discounted rate of $69 per room, single or double occupancy, call:
Jerry Tucker at 314-968-5534
There is no cost for the meeting. A small donation for lunch will be at participant option.
Holiday Inn map: http://www.ichotelsgroup.com/h/d/ex/1/en/hotel/fntno/transportation
For more information or questions, contact:
Gregg Shotwell, SOS ~ or ~ Jerry Tucker, CLR/SEC
greggshotwell@aol.com ~ jtuckernd@sbcglobal.net
616-485-8176 314-968-5534
www.soldiersofsolidarity.com
www.factoryrat.com
www.futureoftheunion.com |
_________________
http://www.toomuchonline.org/index.html
http://www.hr676.org
http://www.pnhp.org/publications/the_national_health_insurance_bill_hr_676.php |
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Fri Jan 18, 2008 10:15 am |
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Dave Starr
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| According to both the Detroit News and the Free Press, buyouts will be offered to 46,000. NOT ALL EMPLOYEES! My guess is that 46,000 represents the employees that are left at the old wage. This allows GM to hire new people at the newer wage scale and cut their labor cost by about 50%. |
_________________
I used to care, but I take a pill for that now.
Pushing buttons sure can be fun.
When a lion wants to go somewhere, he doesn’t worry about how many hyenas are in the way.
Paddle faster, I hear banjos. |
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Fri Jan 18, 2008 11:50 am |
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twotap
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I would assume anyone contemplating retirement from GM would more than likely have a 0 mortgage balance, not raising any kids ( although as most people know your kids never really leave)  would have most of their toys gathered up and have sat down and figured out what they are going to need to enjoy retirement and of course for some having 2 retirement incomes makes it pretty easy. The $35,000 incentive is like icing on the cake. Now an out and out one time buyout I agree they better think that one thru.  |
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Fri Jan 18, 2008 11:53 am |
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FlintConservative
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quote:
twotap schreef:
I would assume anyone contemplating retirement from GM would more than likely have a 0 mortgage balance, not raising any kids ( although as most people know your kids never really leave) would have most of their toys gathered up and have sat down and figured out what they are going to need to enjoy retirement and of course for some having 2 retirement incomes makes it pretty easy. The $35,000 incentive is like icing on the cake. Now an out and out one time buyout I agree they better think that one thru.
And you're assuming that they've been financially responsible. Methinks, in many cases, that's a stretch.
I know many that have contemplated retirement and haven't the slightest idea how much Uncle Scam will take of their buyout, let alone how long it might last them. |
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Fri Jan 18, 2008 8:08 pm |
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