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GM fires 500 engineers
General Motors Corp. will lay off about 500 contract employees, many of them engineers and designers at its technical center in Warren, on Friday as part of the automaker's effort to downsize its money-losing North American operations.
"This is a very challenging time, and these are very difficult decisions for the company," said GM spokesman Robert Herta. "It's all about aligning the work force with our business needs."
GM said the cuts are part of a previously announced plan to reduce its U.S. white collar work force by 7 percent in 2006. The reduction affects both direct GM and contract employees.
Many of the engineers whose jobs are being eliminated have already been contacted by the contractors that employ them.
Several said they were struck by the magnitude of the cuts, noting that GM has steadily eliminated contract jobs but in smaller numbers, 10 or 20 at a time.
The job losses darken the already grim employment outlook for Michigan, which is expected to lose jobs for a sixth straight year in 2006 despite the national economy's resilience. In the past year and a half, the state has lost more than 15,000 professional and business services jobs, a category that includes engineers and designers.
But the move also signals that GM is moving quickly to slash its costs in North America, where it lost $4.8 billion in the first three quarters of 2005.
Since 2000, the automaker has reduced its U.S. salaried and contract employee headcount by 32 percent, averaging annual reductions of around 5.5 percent a year.
In November, Chairman and CEO Rick Wagoner announced a restructuring plan entailing the closure of four assembly and six component plants and the downsizing of other facilities. In all, 30,000 blue-collar jobs will be eliminated by 2008.
The plan called for a steeper 7 percent cut in the ranks of U.S. salaried and contract workers. The company also has cut certain benefits for salaried workers.
In GM's effort to recover profitability in North America, where it is losing ground to Asian rivals unencumbered by huge legacy costs, the U.S. automaker is trying to make better use of its global operations and eliminate duplication of activities.
But for GM contract workers like Danielle Manzella, 30, who is losing her job as an interior components designer in Warren, the news is devastating.
Manzella, who is employed by MSX International, learned this week that she would not only lose her job on Friday but also the health insurance that covers her, her husband and 18-month-old toddler.
"I got a phone call last night, and they said my services will no longer be needed. Friday is my last day," said Manzella, who spent 6 1/2 years working at GM. "The cuts are big. There were 20 people in my row, and only four of them are staying. I'm young, so I'll be OK. But I wonder about the 56-year-old who sits next to me. We weren't expecting it."
One of her colleagues, D'Ann Munro, has been working at GM for 10 years through her company, the staffing agency Aerotek.
"You work here for so long, and you make the cut so many times that you think you're OK," Munro said. "So this is tough."http://www.detnews.com/apps/pbcs.dll/article?AID=/20060105/AUTO01/601050415
GM, Ford lose more ground
Detroit's two biggest automakers ended a tumultuous year with their smallest annual market share on record after reporting a drop in sales last month from the previous December's buoyant levels.
By contrast, DaimlerChrysler AG's Chrysler Group increased its share of the U.S. car and truck market, which grew 0.5 percent last year to 17 million vehicles -- the third-best year ever.
General Motors Corp. and Ford Motor Co. derived little benefit from the strong consumer demand, but GM scored a symbolic victory: Its Chevrolet brand sales, though down in 2005, exceeded Ford brand sales to become the nation's biggest nameplate for the first time since 1986. In addition, the Chevy Trailblazer toppled the Explorer as the best-selling SUV.
Overall, however, GM sales were down 4 percent, according to unadjusted figures by Autodata Corp. "That is somewhat below what we were anticipating," said Paul Ballew, GM's executive director of global market and industry analysis.
Sales at rival Ford fell 5 percent in 2005.
Auto executives predicted sales would be flat or slightly higher this year, underpinned by a growing economy. But they diverged in their predictions about fuel prices, which played a major role last year in shifting sales trends.
Industrywide, trucks and sport utility vehicles lost ground, as fuel prices spiked to more than $3 a gallon, while car sales rose 2 percent last year. GM, which is banking on a slew of new large trucks and SUVs this year to bolster its recovery, predicts gas prices will stabilize at lower levels.http://www.detnews.com/apps/pbcs.dll/article?AID=/20060105/AUTO01/601050399
General Motors Corp. will lay off about 500 contract employees, many of them engineers and designers at its technical center in Warren, on Friday as part of the automaker's effort to downsize its money-losing North American operations.
"This is a very challenging time, and these are very difficult decisions for the company," said GM spokesman Robert Herta. "It's all about aligning the work force with our business needs."
GM said the cuts are part of a previously announced plan to reduce its U.S. white collar work force by 7 percent in 2006. The reduction affects both direct GM and contract employees.
Many of the engineers whose jobs are being eliminated have already been contacted by the contractors that employ them.
Several said they were struck by the magnitude of the cuts, noting that GM has steadily eliminated contract jobs but in smaller numbers, 10 or 20 at a time.
The job losses darken the already grim employment outlook for Michigan, which is expected to lose jobs for a sixth straight year in 2006 despite the national economy's resilience. In the past year and a half, the state has lost more than 15,000 professional and business services jobs, a category that includes engineers and designers.
But the move also signals that GM is moving quickly to slash its costs in North America, where it lost $4.8 billion in the first three quarters of 2005.
Since 2000, the automaker has reduced its U.S. salaried and contract employee headcount by 32 percent, averaging annual reductions of around 5.5 percent a year.
In November, Chairman and CEO Rick Wagoner announced a restructuring plan entailing the closure of four assembly and six component plants and the downsizing of other facilities. In all, 30,000 blue-collar jobs will be eliminated by 2008.
The plan called for a steeper 7 percent cut in the ranks of U.S. salaried and contract workers. The company also has cut certain benefits for salaried workers.
In GM's effort to recover profitability in North America, where it is losing ground to Asian rivals unencumbered by huge legacy costs, the U.S. automaker is trying to make better use of its global operations and eliminate duplication of activities.
But for GM contract workers like Danielle Manzella, 30, who is losing her job as an interior components designer in Warren, the news is devastating.
Manzella, who is employed by MSX International, learned this week that she would not only lose her job on Friday but also the health insurance that covers her, her husband and 18-month-old toddler.
"I got a phone call last night, and they said my services will no longer be needed. Friday is my last day," said Manzella, who spent 6 1/2 years working at GM. "The cuts are big. There were 20 people in my row, and only four of them are staying. I'm young, so I'll be OK. But I wonder about the 56-year-old who sits next to me. We weren't expecting it."
One of her colleagues, D'Ann Munro, has been working at GM for 10 years through her company, the staffing agency Aerotek.
"You work here for so long, and you make the cut so many times that you think you're OK," Munro said. "So this is tough."http://www.detnews.com/apps/pbcs.dll/article?AID=/20060105/AUTO01/601050415
GM, Ford lose more ground
Detroit's two biggest automakers ended a tumultuous year with their smallest annual market share on record after reporting a drop in sales last month from the previous December's buoyant levels.
By contrast, DaimlerChrysler AG's Chrysler Group increased its share of the U.S. car and truck market, which grew 0.5 percent last year to 17 million vehicles -- the third-best year ever.
General Motors Corp. and Ford Motor Co. derived little benefit from the strong consumer demand, but GM scored a symbolic victory: Its Chevrolet brand sales, though down in 2005, exceeded Ford brand sales to become the nation's biggest nameplate for the first time since 1986. In addition, the Chevy Trailblazer toppled the Explorer as the best-selling SUV.
Overall, however, GM sales were down 4 percent, according to unadjusted figures by Autodata Corp. "That is somewhat below what we were anticipating," said Paul Ballew, GM's executive director of global market and industry analysis.
Sales at rival Ford fell 5 percent in 2005.
Auto executives predicted sales would be flat or slightly higher this year, underpinned by a growing economy. But they diverged in their predictions about fuel prices, which played a major role last year in shifting sales trends.
Industrywide, trucks and sport utility vehicles lost ground, as fuel prices spiked to more than $3 a gallon, while car sales rose 2 percent last year. GM, which is banking on a slew of new large trucks and SUVs this year to bolster its recovery, predicts gas prices will stabilize at lower levels.http://www.detnews.com/apps/pbcs.dll/article?AID=/20060105/AUTO01/601050399
