GM will lay off 1,600 workers at 3 factories

ByUSA Today
October 16, 2008, 10:28 PM

DETROIT -- Another 1,600 workers at three General Motors gm factories will be laid off indefinitely over the next few months as the company tries to control its inventory as U.S. sales slump.

About 700 workers at GM's pickup plant in Pontiac will be furloughed starting Feb. 1, while another 500 at the Detroit-Hamtramck sedan factory will be laid off starting Jan. 12, spokesman Chris Lee said Thursday. In addition, 400 workers at a two-seat sports car assembly plant in Wilmington, Del., also will be out of work starting Dec. 8.

Workers were notified of the company's actions Sept. 29, Lee said.

The Detroit-Hamtramck plant, which makes the Buick Lucerne and Cadillac DTS full-size sedans, already is down to a single daily shift. GM will reduce its assembly line speed from 56 to 38 cars per hour to achieve the layoffs, Lee said.

The Pontiac plant, which makes the Chevrolet Silverado and GMC Sierra pickups, also is operating on one shift and will see its line speed go from 55 trucks to 24 trucks per hour.

In Wilmington, the plant that makes the Pontiac Solstice, Saturn Sky and Opel GT roadsters will go from two shifts per day to one, Lee said.

"We don't need excess inventory out there," Lee said. "We adjust up and down to the market. Pickups, as you know, have been impacted, and in this case our large luxuries have been impacted and the small two-seater niche products as well."

Lee said the company plans no further plant announcements at this time.

George McGregor, president of United Auto Workers Local 22 at the Detroit-Hamtramck plant, said the union has known about the layoffs for a while, but didn't know the exact number.

"We don't know when the return date will be. We are just holding on," said the 62-year-old, who has been a GM employee for 41 years. "We had a lot of people who retired early. With what's left now, we are just holding on, taking it day to day, year to year."

McGregor's plant, which employs 1,500 hourly workers, is slated to build the Chevrolet Volt, GM's electric car with a small gas engine to extend its range. The Volt is due in showrooms in late 2010, but McGregor said the union is not sure when production will start.

During the layoff, workers will get close to full pay and benefits through supplemental pay and state unemployment. After 48 weeks they go into a jobs bank in which the company pays 85% of their salaries, plus benefits. Within two years, the workers could lose pay and benefits if they don't transfer to another plant.

GM said the Pontiac truck plant has 1,200 hourly workers, while the Wilmington factory has 1,100.

The automaker announced Monday that it would shutter its metal parts stamping factory near Grand Rapids by the end of 2009, costing 1,520 jobs. It also sped up the end of SUV production at its Janesville, Wis., plant to Dec. 23, eliminating another 1,200 positions.

Industry analysts say the sagging U.S. auto market will force GM to close more plants. U.S. sales overall are down 13% for the first nine months of this year, with predictions that automakers will sell 2 million fewer vehicles than they did last year.

GM is burning through more than $1 billion in cash per month and analysts say it may reach the minimum amount of money to run the company sometime next year. GM's sales are down 18%, and the company has lost $57.5 billion in the past 18 months, largely because of tax accounting changes.

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