GM plans deeper cuts
DETROIT (AP) -- General Motors Corp.'s top managers are working on
additional restructuring measures to deal with a declining U.S. auto
market and an accelerated shift from trucks to more fuel efficient
vehicles, a person familiar with the plan told The Associated Press late
The person, who requested anonymity because the plan is still being
devised, would not give details of what is under discussion by Chairman
and Chief Executive Officer Rick Wagoner and his top managers.
The restructuring, which follows thousands of job cuts over the past
three years mainly through buyout and early retirement offers, is to be
announced at the company's annual meeting in Wilmington, Del., on June
3, The Wall Street Journal reported Wednesday night.
GM spokesman Tom Wilkinson said he could not comment.
The new steps likely will involve further cost cuts including reduced
truck and sport utility vehicle production and a faster rollout of more
car and crossover models, similar to what Ford Motor Co. (F, Fortune
500) announced last week. Already this week GM announced it would speed
up the elimination of one shift each at its Flint and Pontiac pickup
Ford on Wednesday confirmed that it is looking at involuntary layoffs of
salaried employees, perhaps costing as many as 2,000 workers their jobs.
The Journal quoted GM Director George Fisher as saying that the company
must take further steps.
"Obviously these times dictate more actions, and Rick and the team are
about doing that," Fisher said in an interview with the newspaper. "Rick
and the team are looking at what things can be done and will be done."
GM (GM, Fortune 500) shares on Tuesday dropped as low as $16.87, their
lowest level in nearly 26 years. The automaker's stock closed Wednesday
at $17.15, down 27 cents, or 1.6%.
The company also has just emerged from a spate of labor problems, with
two local union strikes at key factories and a nearly three-month strike
at key parts maker American Axle and Manufacturing Holdings Inc (AXL).
GM said in a regulatory filing last week that the strikes will cost it a
total of $2 billion before taxes in the second quarter.
Fisher told the Journal that GM's board fully supports the company's