General Motors Offers to Buy out Hourly-Paid Jobs after Record Loss Last Year; AUTOMOTIVE
General Motors has offered to buy out the jobs of its hourly-paid workers after recording the car industry's biggest annual loss in 2007.
The Detroit group, which looks set to lose its long-held status as the world's biggest carmaker in terms of sales to Toyota, announced yesterday that it lost EUR38.7 billion, or pounds 19.8 billion last year.
GM attributed the bulk to a third quarter charge of some EUR38.3 billion related to an unused tax credit. Stripping that out of the annual accounts would have meant that the company would have virtually broken even in 2007 after making a loss of EUR2 billion (pounds 1.026 billion) the year before.
A fourth quarter loss of EUR722 million (pounds 370 million), which contrasted with a profit of EUR950 million (pounds 487 million) in the same period the year before, was said to be due to the big slowdown in the US car market as economic woes set in plus big losses at General Motors Acceptance Corporation (GMAC), the group's finance arm. GM, which owns European brands Vauxhall and Saab, said it was offering a new round of buyouts, or redundancies, worth up to EUR140,000 (nearly pounds 72,000) to all 74,000 of its US manufacturing workers.
That follows the signing last year of a historic cost cutting deal with the United Auto Workers Union. …