Buyouts may top 40,000
Saturday, June 24, 2006
Buyouts may top 40,000
In final day, more GM, Delphi workers come forward to take separation deals.
Brett Clanton / The Detroit News
Massive job-cutting efforts at General Motors Corp. and bankrupt Delphi Corp. got an eleventh-hour boost Friday thanks to a last-minute rush for the exits by workers signing up for cash buyouts or early retirement.
The surge may have pushed the final tally at GM and Delphi higher than 40,000 workers, capping with a bang one of the biggest one-time downsizing events in the history of the U.S. auto industry.
With hours to go before the midnight deadline, workers who had delayed decisions for personal reasons or were holding out for better offers finally came forward to fill out the paperwork, United Auto Workers officials and workers at GM and Delphi plants said Friday.
Neither GM nor Delphi officials would say how many workers had signed up for early retirement or cash buyouts as of Friday evening. GM CEO Rick Wagoner will announce preliminary results on Monday. A final count won't be available until at least next Friday because workers have until then to change their minds.
But sources familiar with the situation said that by Thursday night more than 28,000 GM workers and better than 9,000 at Delphi had accepted offers. The stream of takers continued Friday, the final day workers had to decide whether to accept sweeteners to leave or stay and risk losing their job later if the companies' problems continue.
Mike Hanley, president of UAW Local 699, representing Delphi workers in Saginaw, said the program was playing out just as anticipated.
"I know there was a surge yesterday," he said Friday, "and we're expecting another one today."
By Friday afternoon, 1,900 of the plant's 3,000 workers had committed to offers, and he predicted that number would grow slightly by day's end.
Plant to lose third of workers
There was also a last-minute bump at GM's Corvette plant in Bowling Green, Ky., where about 300 of the factory's 1,000 workers are planning to leave under the program, said David Folk, a union representative at the factory.
"It's probably jumped 50 people today," Folk said.
The strong response to the historic "accelerated attrition" program will allow GM to achieve a key part of its North American turnaround plan -- cutting 30,000 U.S. factory jobs by 2008 -- two years early.
It will also help auto parts maker Delphi lower labor costs en route to its goal of emerging from bankruptcy by next year.
But GM and Delphi could struggle to maintain the same level of quality, productivity and safety in their factories as they wave goodbye to thousands of experienced workers.
"When you lose that many people at one time, there are going to be some challenges," said Kevin Reale, an industry analyst with AMR Research in Clarkston.
GM, which lost $10.6 billion last year, is implementing a sweeping restructuring plan in North America that calls for closing all or part of a dozen of its U.S. plants by 2008, reshaping its eight brands, overhauling its pension system and cutting executive pay.
Central to that effort is the buyout plan, which the United Auto Workers agreed to in March to help GM and Delphi lower labor costs and become more competitive.
At GM, the program chiefly targeted the automaker's 36,000 retirement-eligible workers. But the plan -- offered to all 113,000 of GM's U.S. hourly workers -- also extended cash buyouts of as much as $140,000 to lower-seniority workers if they severed all ties with the automaker.
At Delphi, the program was initially aimed at 13,000 UAW workers with a minimum of 27 years on the job. But this month, it was expanded to include cash buyouts similar to those at GM and workers with 26 years of experience. A separate program, also cleared this month, will extend similar offers to workers at the International Union of Electrical Workers-Communications Workers of America, which represents 8,500 of Delphi's 33,000 U.S. workers.
Based on early returns from the GM program, Merrill Lynch analyst John Murphy on Friday reiterated his "buy" rating on the automaker.
"We believe the company is successfully accelerating its restructuring efforts through its buyout program, which will result in significant cost savings in the near-term."
But the visibility isn't as clear at Delphi, which won't have a good picture for weeks of how many workers will leave under its program. Higher-seniority workers had until Friday to sign up for offers, while those with 26 years or less on the job will have until at least the end of July to decide.
Are young workers leaving?
GM and Delphi officials would not disclose the age breakdown of workers taking the offers. But analysts have suggested that more younger workers than expected have accepted offers.
Take Jeffery Martin, a 27-year-old production worker at GM's Pontiac truck assembly plant. Like many others, he waited until Friday to make a move, figuring GM would extend the deadline or increase the package size. But in the end, after six years with GM, he chose a $70,000 buyout.
"I'm going to use the money to start my own plumbing business," he said, as he left the factory Friday.
On the flip side, Louis Horvath -- a 70-year-old production worker at GM's Willow Run transmission plant in Ypsilanti -- was the perfect candidate to accept a retirement offer. But even after 43 years on the job, Horvath said he wants to keep working.
"I'm in good health," he said, "and I love my job."
Earlier this month, GM wrapped up a separate buyout plan with IUE workers at its Moraine, Ohio, SUV factory. Of 4,100 workers at the plant, about 1,200 workers signed up for buyouts and retirement packages.
GM and Delphi officials said official counts from UAW-represented plants would not be available until Monday morning, and that an announcement likely would not come until Monday afternoon.
You can reach Brett Clanton at (313) 222-2612 or bclanton@detnews.com.
Buyouts may top 40,000
In final day, more GM, Delphi workers come forward to take separation deals.
Brett Clanton / The Detroit News
Massive job-cutting efforts at General Motors Corp. and bankrupt Delphi Corp. got an eleventh-hour boost Friday thanks to a last-minute rush for the exits by workers signing up for cash buyouts or early retirement.
The surge may have pushed the final tally at GM and Delphi higher than 40,000 workers, capping with a bang one of the biggest one-time downsizing events in the history of the U.S. auto industry.
With hours to go before the midnight deadline, workers who had delayed decisions for personal reasons or were holding out for better offers finally came forward to fill out the paperwork, United Auto Workers officials and workers at GM and Delphi plants said Friday.
Neither GM nor Delphi officials would say how many workers had signed up for early retirement or cash buyouts as of Friday evening. GM CEO Rick Wagoner will announce preliminary results on Monday. A final count won't be available until at least next Friday because workers have until then to change their minds.
But sources familiar with the situation said that by Thursday night more than 28,000 GM workers and better than 9,000 at Delphi had accepted offers. The stream of takers continued Friday, the final day workers had to decide whether to accept sweeteners to leave or stay and risk losing their job later if the companies' problems continue.
Mike Hanley, president of UAW Local 699, representing Delphi workers in Saginaw, said the program was playing out just as anticipated.
"I know there was a surge yesterday," he said Friday, "and we're expecting another one today."
By Friday afternoon, 1,900 of the plant's 3,000 workers had committed to offers, and he predicted that number would grow slightly by day's end.
Plant to lose third of workers
There was also a last-minute bump at GM's Corvette plant in Bowling Green, Ky., where about 300 of the factory's 1,000 workers are planning to leave under the program, said David Folk, a union representative at the factory.
"It's probably jumped 50 people today," Folk said.
The strong response to the historic "accelerated attrition" program will allow GM to achieve a key part of its North American turnaround plan -- cutting 30,000 U.S. factory jobs by 2008 -- two years early.
It will also help auto parts maker Delphi lower labor costs en route to its goal of emerging from bankruptcy by next year.
But GM and Delphi could struggle to maintain the same level of quality, productivity and safety in their factories as they wave goodbye to thousands of experienced workers.
"When you lose that many people at one time, there are going to be some challenges," said Kevin Reale, an industry analyst with AMR Research in Clarkston.
GM, which lost $10.6 billion last year, is implementing a sweeping restructuring plan in North America that calls for closing all or part of a dozen of its U.S. plants by 2008, reshaping its eight brands, overhauling its pension system and cutting executive pay.
Central to that effort is the buyout plan, which the United Auto Workers agreed to in March to help GM and Delphi lower labor costs and become more competitive.
At GM, the program chiefly targeted the automaker's 36,000 retirement-eligible workers. But the plan -- offered to all 113,000 of GM's U.S. hourly workers -- also extended cash buyouts of as much as $140,000 to lower-seniority workers if they severed all ties with the automaker.
At Delphi, the program was initially aimed at 13,000 UAW workers with a minimum of 27 years on the job. But this month, it was expanded to include cash buyouts similar to those at GM and workers with 26 years of experience. A separate program, also cleared this month, will extend similar offers to workers at the International Union of Electrical Workers-Communications Workers of America, which represents 8,500 of Delphi's 33,000 U.S. workers.
Based on early returns from the GM program, Merrill Lynch analyst John Murphy on Friday reiterated his "buy" rating on the automaker.
"We believe the company is successfully accelerating its restructuring efforts through its buyout program, which will result in significant cost savings in the near-term."
But the visibility isn't as clear at Delphi, which won't have a good picture for weeks of how many workers will leave under its program. Higher-seniority workers had until Friday to sign up for offers, while those with 26 years or less on the job will have until at least the end of July to decide.
Are young workers leaving?
GM and Delphi officials would not disclose the age breakdown of workers taking the offers. But analysts have suggested that more younger workers than expected have accepted offers.
Take Jeffery Martin, a 27-year-old production worker at GM's Pontiac truck assembly plant. Like many others, he waited until Friday to make a move, figuring GM would extend the deadline or increase the package size. But in the end, after six years with GM, he chose a $70,000 buyout.
"I'm going to use the money to start my own plumbing business," he said, as he left the factory Friday.
On the flip side, Louis Horvath -- a 70-year-old production worker at GM's Willow Run transmission plant in Ypsilanti -- was the perfect candidate to accept a retirement offer. But even after 43 years on the job, Horvath said he wants to keep working.
"I'm in good health," he said, "and I love my job."
Earlier this month, GM wrapped up a separate buyout plan with IUE workers at its Moraine, Ohio, SUV factory. Of 4,100 workers at the plant, about 1,200 workers signed up for buyouts and retirement packages.
GM and Delphi officials said official counts from UAW-represented plants would not be available until Monday morning, and that an announcement likely would not come until Monday afternoon.
You can reach Brett Clanton at (313) 222-2612 or bclanton@detnews.com.
posted by Walking Contradiction at 1:50 AM
0 Comments:
Post a Comment
<< Home