GM to Cut North American White-Collar Workers

NEW YORK March 20, 2005; Reuters reported that General Motors Corp. plans to cut its North American white-collar work force, the Wall Street Journal reported on its Web site on Sunday, less than a week after the automaker warned that 2005 earnings would fall short of its target.

The cuts in salaried staff could be as deep as 28 percent in certain functions, according to the newspaper that cited industry officials and analysts. The paper did not specify a time frame for the cuts, nor did it provide an overall number for the expected job cuts.

"We've had a fair amount of natural attrition for a while," said GM spokeswoman Toni Simonetti, "From time to time we've accelerated attrition. But there's no broad based across the board target."

In some areas of the business, the company is looking at reductions of as much as 28 percent, she added, but noted that those cuts were in the works prior to last week's profit warning.

The company said last week that earnings this year would be 80 percent below its prior forecast as a result of slumping North American auto sales.

The newspaper called the cuts a prelude to health-care concessions that GM would seek from its largest union, the United Auto Workers.

Asked if GM has opened negotiations with UAW, Simonetti said, "Suffice it to say, we have an ongoing and open dialogue with the union."