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TeamCasey
06-07-2005, 11:13 AM
http://www.msnbc.msn.com/id/8129876/

GM to slash jobs, close more plants
CEO says 25,000 manufacturing positions to be cut

The Associated Press
Updated: 9:58 a.m. ET June 7, 2005


WILMINGTON, Del. - General Motors Corp. plans to eliminate 25,000 jobs in the United States by 2008 and to close plants as part of a strategy to revive its struggling North American operations.

Speaking to shareholders at GM’s 96th annual shareholder meeting in Delaware Tuesday morning, Chairman and Chief Executive Rick Wagoner said the capacity and job cuts will generate annual savings of roughly $2.5 billion.

Wagoner revealed the cutbacks as he laid out a four-step strategy to revive GM’s North American business, the biggest and most troubling part of the world’s largest automaker.

Wagoner focused on priorities for clarifying the role of each of GM’s eight brands, intensifying efforts to reduce cost and improve quality and continuing to search for ways to reduce skyrocketing health care costs.

He noted that the company’s current $1,500 per worker health-care expense puts GM at a “significant disadvantage versus foreign-based competitors,” and said GM has conducted “intense discussions” with the unions about how to reduce health-care costs.

Billionaire investor Kirk Kerkorian’s offer to purchase 28 million GM shares at $31 apiece, boosting his stake to about 9 percent from 4 percent, expires later today.

In the cost-reduction area, Wagoner said it was vital for the company to improve efficiency at its manufacturing plants. He said that plant closings and idlings in recent months have reduced assembly capacity in North America from 6 million in 2002 to 5 million by the end of this year.

It was not immediately known which GM plants would be closed.

“Let me say up front that our absolute top priority is to get our largest business unit back to profitability as soon as possible,” Wagoner said.

Messages were left Tuesday morning with the United Auto Workers and a GM spokeswoman for manufacturing issues.

GM has already closed several facilities this year. The company shut a factory in Linden, N.J., in April and a factory in Baltimore in May, affecting around 2,000 employees. The company also closed two plants in Lansing, Mich., last month, although those 3,500 employees are expected to find work at other GM facilities in the city.

Johnny Footstool
06-07-2005, 11:20 AM
I just saw a commercial yesterday that said GM is extending its employee discount to everyone in America. I thought that was a pretty nice sales technique.

I guess this is the reason they can afford to do it. :thumbdown

macro
06-07-2005, 11:21 AM
Could part of the reason for this be that people are becoming more and more aware that they can get a more reliable vehicle from places like Georgetown, Kentucky?

macro
06-07-2005, 11:30 AM
I just saw a commercial yesterday that said GM is extending its employee discount to everyone in America. I thought that was a pretty nice sales technique.

I guess this is the reason they can afford to do it. :thumbdown

I suspect it's a gimmick. We were shopping for a new Ford a couple of years ago and the dealer asked if we would be buying on the A-plan (or whatever Ford calls their employee discount). When we told him that we weren't Ford employees he said that he might be able to get us the discount anyway. Then again, he might have been planning to tell us we were getting the employee discount while padding that difference elsewhere in the selling price. :dunno:

We decided to buy used, instead. We ended up selling our car on Auto Trader for $1200 more than any dealer would offer and bought off Auto Trader from a very nice couple in Indy for about $1800 less than dealers wanted for a similar vehicle. For those keeping score, that's $3,000 more that we have in our bank account today.

RedsBaron
06-07-2005, 11:39 AM
I believe Ford calls its employee discount the "X plan"-it was offered to me a couple of years ago by a dealer who knew I could get a GM discount because our firm did legal work for GM.

919191
06-07-2005, 11:51 AM
I can get a supplier discount that I hear is pretty nice because my employer owns a company that produces an adhesive GM uses, but I haven't used it.

GIK
06-07-2005, 12:01 PM
Ford discounts: "X-plan" is for suppliers (and dealers will sometimes offer this to customers, although they technically aren't supposed to) and "A-plan" is for employees (which no one off the street should be getting).

Red Leader
06-07-2005, 12:07 PM
This news tremendously hurts our company's business. We have more GM customers than any other manufacturer. Probably wouldn't be a bad idea for me to update the resume again. We also receive the GM Supplier discount through our company. It allows us to buy GM vehicles at 1% below dealer invoice. Of course, we have discount purchase programs through Ford, Nissan, Chrysler, VW/Audi, Isuzu, and Subaru.

macro
06-07-2005, 12:49 PM
Ford discounts: "X-plan" is for suppliers (and dealers will sometimes offer this to customers, although they technically aren't supposed to) and "A-plan" is for employees (which no one off the street should be getting).

It may have been the X-plan instead of the A-plan that we were offered.

KronoRed
06-07-2005, 12:51 PM
Hope it's not too serious on your company RL. :(

Red Leader
06-07-2005, 12:55 PM
Hope it's not too serious on your company RL. :(

We supply computer hardware / software for over 14,000 car dealerships, around 8300 of which are GM dealers. I don't think my job will be directly effected, but the stock options we get every year probably won't be too useful this year. :laugh:

Red in Chicago
06-07-2005, 07:00 PM
what are the odds that with them offering the gm discount to everyone, that the interest rates they charge will be increased? the other day when i was pricing a new saab online, it had a 9% interest rate prefilled in the box and i couldn't change it. maybe this field has been modified since, but why would anyone pay 9% interest rates :eek:

GIK
06-07-2005, 07:27 PM
Interest rates are on the rise. 0% isn't really common any longer and a 6-7% rate is actually "good" for a 60 month term now (and no, I don't work at a dealership).

SunDeck
06-07-2005, 09:08 PM
Both Ford and GM both seem to be in pretty deep trouble. Scaling back really seems like the only way GM can survive. They just can't sell enough of what they are building. Maybe some of their new designs will help, but man, not from what I've seen. Most of the new stuff is just goofy.

LvJ
06-07-2005, 09:43 PM
Wrong thread. :)

MWM
06-07-2005, 09:52 PM
All of the American Auto companies are in trouble, unfortunately. They suffer from lack of creativity and a refusal to change the way they do business. Their designs lack any kind of appeal in general. But the kicker is that they have to pay out $2000 in pensions for retired auto workers for every single car before it even begins production. Not saying it's right or wrong, but it's killing their ability to compete.

Reds4Life
06-07-2005, 09:55 PM
Maybe some of their new designs will help, but man, not from what I've seen. Most of the new stuff is just goofy.

It isn't just GM, many of the new cars are just flat out ugly. I was in the market for a new car and I went to the Auto Show and honestly wasn't impressed with much of anything, especially at some of the prices I saw. $30k for a Camry? No thanks.

GIK
06-07-2005, 10:38 PM
Let's not forget the UAW...they've got both GM and Ford over a barrel.

SunDeck
06-08-2005, 08:59 AM
It isn't just GM, many of the new cars are just flat out ugly. I was in the market for a new car and I went to the Auto Show and honestly wasn't impressed with much of anything, especially at some of the prices I saw. $30k for a Camry? No thanks.

Toyota hasn't produced a good looking car since the early Celicas. People buy them because you don't have to keep running them back to the shop.
No way you should be paying that much for a Camry. For that much, I think you might be able to get into a <DROOL>Volvo S40</DROOL>. The Nissan Altima is pretty sporty looking, too and are more in the Camry class ($22-$25K).

15fan
06-08-2005, 09:59 AM
SD - we just sold Mrs. Fan's 2001 S40. It's a nice looking car with some zip. But it's not a good car to have if (1) you're going to have more than 2 people in it on a regular basis, (2) any of the passengers are taller than 5'8", or (3) you're going to be hoisting a kiddo in & out of the back seat.

As for GM - maybe they'd be in better shape if they quit building dull & crappy cars.

gonelong
06-08-2005, 10:48 AM
Toyota hasn't produced a good looking car since the early Celicas. People buy them because you don't have to keep running them back to the shop.


My father-in-law worked at Ford so I get the A-Plan from the via my wife so we buy Fords exclusively. (I could care less about what make of car I drive, I'd drive a Chevy without a second thought if I'd get the same deal.)

My wife purchased a new Escort in 1994 (5 speed) that she and I drove for 10 years putting 150+ miles on it. Outside of oil and filters I changed a single tie-end rod. Didn't so much as flush the radiator for maintenance. I traded that car in, still ran great, wish I'd have kept it.

Currently own a 2002 Escape 4x4, has 50,000 miles on it. Not a single issue with it.

Currently own a 2000 Taurus with 150,000 miles on it. Outside of oil and filters I've replaced a serpentine belt on it. (The Escort had all original belts and hoses when I traded it in :) )

We have roughly 350,000 miles on these vehicals over a 10 year period with 2 minor trips to the dealer-ship for repairs.

I'm sure others have had different expericences, but (knock on wood) we have had no issues with our Fords and I'll be buying them again in a few years.

GL

SunDeck
06-08-2005, 02:31 PM
SD - we just sold Mrs. Fan's 2001 S40. It's a nice looking car with some zip. But it's not a good car to have if (1) you're going to have more than 2 people in it on a regular basis, (2) any of the passengers are taller than 5'8", or (3) you're going to be hoisting a kiddo in & out of the back seat.

As for GM - maybe they'd be in better shape if they quit building dull & crappy cars.
Roger that, 15. I think GM is trying anything, I MEAN ANYTHING to get peoples attention. Except building good cars.


And I knew the S40 was cramped but that does it. I won't buy one!

SunDeck
06-08-2005, 02:33 PM
My father-in-law worked at Ford so I get the A-Plan from the via my wife so we buy Fords exclusively. (I could care less about what make of car I drive, I'd drive a Chevy without a second thought if I'd get the same deal.)

My wife purchased a new Escort in 1994 (5 speed) that she and I drove for 10 years putting 150+ miles on it. Outside of oil and filters I changed a single tie-end rod. Didn't so much as flush the radiator for maintenance. I traded that car in, still ran great, wish I'd have kept it.

Currently own a 2002 Escape 4x4, has 50,000 miles on it. Not a single issue with it.

Currently own a 2000 Taurus with 150,000 miles on it. Outside of oil and filters I've replaced a serpentine belt on it. (The Escort had all original belts and hoses when I traded it in :) )

We have roughly 350,000 miles on these vehicals over a 10 year period with 2 minor trips to the dealer-ship for repairs.

I'm sure others have had different expericences, but (knock on wood) we have had no issues with our Fords and I'll be buying them again in a few years.

GL

I've had mixed results. My '94 Ranger (it's really a Mazda) has been a good truck, but my wife's Focus just made her crazy with all the quality control problems. We also have been Ford customers because of my dad's relationship with a dealer in town, but I'm gun shy after that Focus.

Rojo
06-08-2005, 05:24 PM
He noted that the company’s current $1,500 per worker health-care expense puts GM at a “significant disadvantage versus foreign-based competitors,” and said GM has conducted “intense discussions” with the unions about how to reduce health-care costs.

Corporate America setting the groundwork for National Healthcare.

REDREAD
06-08-2005, 05:51 PM
Corporate America setting the groundwork for National Healthcare.

Yes, it was the cooporations that pushed through that perscription healthcare thing that Bush signed off on a couple years ago.. so that coorporations wouldn't have to spend as much on their retirees.