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‘Important changes’ await GM
TweetThe date of the Cruze launch is again being questioned.
STAFF REPORT
Speculation is building that General Motors is announcing major cuts today.
GM will release its third-quarter earnings report this morning and then hold a conference call with industry analysts and the media to review steps it’s taking to preserve its cash reserves.
Media reports indicate those could include laying off more salaried staff and cutting benefits.
CNBC.com reported Thursday that GM will announce that it is saving money by delaying the launch of many new models. This could affect the Lordstown complex because it is preparing to launch GM’s next compact car, the Chevrolet Cruze, in 2010.
Automotive News, a trade magazine, and BusinessWeek reported last month that the Cruze launch was being pushed back one year to 2011.
Analysts have said that GM is burning through its cash so quickly that it won’t have enough money to run its daily operations by sometime next year.
An internal e-mail obtained by The Detroit News warns GM executives that “important changes” are going to be announced today. It doesn’t give specifics but said GM must face challenges “brought on by the volatile global economic situation.”
In October, however, executives informed employees that they were considering cutting more white-collar jobs, including involuntary layoffs, later this year and early next year, as well as suspending the company match in employee 401(k) retirement accounts and making other benefit cuts.
GM already has cut 5,000 salaried jobs.
Industry analysts are saying more plant closings could be part of GM’s announcement.
The Associated Press reported that people briefed on GM plans say the company will not announce any new plant closures. But the automaker still plans to announce factory job cuts, likely through shift reductions and temporary plant shutdowns as U.S. auto sales continue to tumble.
GM last summer put forth a plan that included cutting $10 billion in costs by the end of 2009 and raising $5 billion through asset sales and borrowing, but the nation’s economy has slowed since then, and auto sales have dropped dramatically.
GM’s announcement is expected to include a large quarterly loss.
Comments
I posted this comment on November 2,2008.
It was in response to statements made by Mr. Russo,one of the Co-Directors,of "The Center for Working Class Studies"
“We’ve been arguing for years that Youngstown’s story is America’s story,” Russo said. “What happened in the latter part of the 20th century in Youngstown is what’s happening nationally now.”
Mr. Russo...Have you been talking to Sarah Palin? Can you see the cities of America from the roof of YSU? That's a pretty broad brush you're painting with. Center for Working Class Studies, and you are a 'co-director?" Jay Williams and Lordstown? Yeah, those are great strides,they are,but is that the best you can come up with? Especially, with GM near the brink,where God forbid,could go belly-up? All your eggs are in one basket!I'll bet you don't think that could happen though. Sorry dude, but you need to take some time off and travel outside Ohio, PA, and the great state of Detroit!(LOL)I believe in the glass half full or half empty, but, sorry, your glass broke and you didn't see it, so stop pouring! It took youngstown 30 yrs to get to this point, and as they say, you can't get back or even close by 2010. The downward spiral has slow down so you can pass it on the way up. No one wants to see what's been happening to Youngstown, but it is what it is!
wake up ...G M has no plans to build the Cruze in Lordstown .... G M has now let the "cat out of the bag " ...it invested 600 mill in Russia at its new Cruze plant .... wake up America !!!!!!!