And this is only the beginning, as 3,400 people will soon join unemployment offices' lines in the US over the following months and a total of 18,000 blue-collar workers by the end of the year. In all, GM will cut 47,000 jobs worldwide by the end of the 2009.
“It will impact every area of the business. Some of those will be through normal attrition, but there will be a significant number of involuntary separations coming from now through the early part of May,” Wilkinson was quoted as saying by the aforementioned source.
Yesterday's layoffs targeted the so called "white collar" jobs, as most of them were mainly engineers. “These are good capable people,” Wilkinson said of those being laid off. “The reductions are just necessary to implement the viability plan and restructure the business to make it self-sustaining.”
GM will offer those affected by the cutbacks roughly two weeks of severance pay for every year they have worked for the company. As for the hourly workers, yesterday was the deadline set by GM for them to decide whether to take $20,000 in cash and a $25,000 car voucher to leave the company.
Even this is an act of self preservation, GM's layoff program debut is a signal that the fight is only just beginning. Chrysler's blue-collar workers are facing the Friday deadline, when they will have to make the same choice as their GM colleagues.
The offer Chrysler made gives the workers a choice of a $75,000 cash buyout and a $25,000 voucher to buy a car to leave the company. Workers eligible for early retirement can get $50,000 and a $25,000 car voucher.
The UAW is still undecided on how to react, as they would prefer to continue working for the car manufacturers, provided that the US government will grant more loans to the companies.