www.jobberz.com
Robert Snell / The Detroit News
DETROIT -- General Motors Corp. is telling workers this morning it will make further production cuts at several factories, according to people briefed on the discussions.
GM announced it will shut down plants in Orion Township, Oshawa, Ont., and Lordstown, Ohio, for an additional week in January and reinstate a week-long shutdown in Wentzville, Mo., in December.
The Detroit automaker also moved up a temporary week-long shutdown in January at its plant in Kansas City that makes the Chevrolet Malibu and Saturn Aura and said it will stop operations at its Oshawa truck plant in May 2009, about two months earlier than previously announced.
GM has announced thousands of factory layoffs so far this year and is cutting its salaried staff in order to pare expenses and conserve cash.
"The impetus really is the extreme unpredictability in the market right now," GM spokesman Chris Lee said. "In some cases, we are adjusting our plant production schedules more frequently to respond to the market than we ever have in the past."
Dave Green, president of UAW Local 1714 in Lordstown, Ohio, said workers were told at 8 a.m. that the plant would be shut down for an extra week Jan. 5. Along with previously announced shutdowns, the plant, which employs about 5,000 workers who make the Chevrolet Cobalt and Pontiac G5, will be shut down from Dec. 23 until Jan. 20.
Cobalt sales were down 62 percent last month compared to a year ago and G5 sales were off 69 percent.
When the plant reopens, about 130 workers will be laid off, and the rate of production will be slowed, said Green, adding that workers were bracing for deeper cuts.
"It's almost a bit of a relief," he said. "It could have been worse. Don't be sorry for us, go buy a Cobalt."
In other moves, GM will reinstate scheduled overtime at its plants in Delta Township, Spring Hill, Tenn., Arlington, Texas., and Ft. Wayne, Ind. The automaker also will slow the speed of its production line at the Kansas City plant earlier than previously announced. The change in production speed will happen Jan. 20 instead of the first week of February.
The new cuts come as GM tries to boost its cash reserves and pursues a piece of $25 billion in federal aid after warning it might not have enough money to meet minimum funding requirements early in 2009.
On Thursday, congressional leaders asked Detroit's Big Three automakers to present a plan by Dec. 2 for restructuring their businesses and how they would spend $25 billion in government loans.
GM has lost about $73 million since 2004, including more than $20 billion this year, and suffered a 45.1 percent sales decline last month, its worst since the end of World War II, when adjusted for population growth.
The automaker outlined a plan in July to increase liquidity by $15 billion, and earlier this month announced an additional $5 billion in cost savings, including more job cuts.
The automaker ran through $6.9 billion in the third quarter, leaving it with $16.2 billion in cash, securities and readily available assets, down from $21 billion at the end of June.
The cash problem forced GM this month to halt talks to acquire rival Chrysler LLC from private equity firm Cerberus Capital Management LP.
The Associated Press contributed to this report.
Friday, November 21, 2008
Gettelfinger: Jobs bank 'almost gone'
http://www.jobberz.com/
Bryce G. Hoffman / The Detroit News
Reports that the United Auto Workers union is in talks to dismantle the controversial jobs bank program are premature, according to people familiar with the situation.
The possibility of more concessions from the union has emerged as Detroit's Big Three automakers are seeking $25 billion in emergency loans from the federal government as they burn through cash amid plunging car and truck sales.
Congress this week rebuffed proposals to give the automakers aid through the $700 billion Wall Street rescue package or by easing restrictions on $25 billion in loans through the Energy Department, a program that was funded in September, to allow the companies to use the money for immediate needs rather than solely to retool plants to make more fuel-efficient vehicles.
The companies could still get the aid, but they have to present Congress with a plan by Dec. 2 showing how they can become financially viable and how they would spend the loan money.
That could include negotiating additional concessions from the UAW, and sources at both Ford Motor Co. and General Motors Corp. say they have been talking to the union throughout the hearing process as part of their ongoing negotiations.
The automakers and the union have not specifically discussed eliminating the jobs bank, a source familiar with the situation said.
GM anticipates that the future of the jobs bank will be part of its ongoing talks with the union as the company seeks additional ways to cut costs.
As The Detroit News reported Thursday, UAW President Ron Gettelfinger said that the jobs bank wasn't a major factor anymore because the number of workers in it had whittled down significantly under provisions of the labor agreement reached with the auto companies last year.
Gettelfinger said the jobs bank has been reorganized (which pays workers 95 percent of their wage while on layoff), adding that Ford has taken 40,000 workers out since 2005 and GM has removed about 47,000. Currently, Chrysler has 711 workers in the jobs bank, GM has 1,404 and Ford has 1,476.
"It's not gone yet but it's almost gone," Gettelfinger said. "We're on the verge of eliminating that provision." And new language in the 2007 contract stripped it to a "mere shadow of what it used to be."
While the specific provisions vary from company to company, idled union members now have a limited number of times they can reject offers of work at other facilities before losing their jobs. Company sources said these provisions would have allowed them to eliminate all or most of the workers still in their jobs banks by now, were it not for a dramatic drop in car and truck sales that has forced each of the automakers to cut production and idle more workers.
Gettelfinger testified on Capitol Hill this week alongside the chief executive officers of Detroit's Big Three. He said that the union continues to talk to the automakers and has worked with them in recent years to reduce costs by agreeing to a range of concessions on health care, wages, factory work rules and other issues in recent years, including as part of last year's labor talks on new national contracts.
Eliminating the program entirely would be a tough sell for Gettelfinger, who is unlikely to support any change that would put these workers out on the street. Additional buyouts remain an option, but the idea of nearly bankrupt automakers paying idled workers to leave is also likely to draw sharp criticism from some in Congress.
Bryce G. Hoffman / The Detroit News
Reports that the United Auto Workers union is in talks to dismantle the controversial jobs bank program are premature, according to people familiar with the situation.
The possibility of more concessions from the union has emerged as Detroit's Big Three automakers are seeking $25 billion in emergency loans from the federal government as they burn through cash amid plunging car and truck sales.
Congress this week rebuffed proposals to give the automakers aid through the $700 billion Wall Street rescue package or by easing restrictions on $25 billion in loans through the Energy Department, a program that was funded in September, to allow the companies to use the money for immediate needs rather than solely to retool plants to make more fuel-efficient vehicles.
The companies could still get the aid, but they have to present Congress with a plan by Dec. 2 showing how they can become financially viable and how they would spend the loan money.
That could include negotiating additional concessions from the UAW, and sources at both Ford Motor Co. and General Motors Corp. say they have been talking to the union throughout the hearing process as part of their ongoing negotiations.
The automakers and the union have not specifically discussed eliminating the jobs bank, a source familiar with the situation said.
GM anticipates that the future of the jobs bank will be part of its ongoing talks with the union as the company seeks additional ways to cut costs.
As The Detroit News reported Thursday, UAW President Ron Gettelfinger said that the jobs bank wasn't a major factor anymore because the number of workers in it had whittled down significantly under provisions of the labor agreement reached with the auto companies last year.
Gettelfinger said the jobs bank has been reorganized (which pays workers 95 percent of their wage while on layoff), adding that Ford has taken 40,000 workers out since 2005 and GM has removed about 47,000. Currently, Chrysler has 711 workers in the jobs bank, GM has 1,404 and Ford has 1,476.
"It's not gone yet but it's almost gone," Gettelfinger said. "We're on the verge of eliminating that provision." And new language in the 2007 contract stripped it to a "mere shadow of what it used to be."
While the specific provisions vary from company to company, idled union members now have a limited number of times they can reject offers of work at other facilities before losing their jobs. Company sources said these provisions would have allowed them to eliminate all or most of the workers still in their jobs banks by now, were it not for a dramatic drop in car and truck sales that has forced each of the automakers to cut production and idle more workers.
Gettelfinger testified on Capitol Hill this week alongside the chief executive officers of Detroit's Big Three. He said that the union continues to talk to the automakers and has worked with them in recent years to reduce costs by agreeing to a range of concessions on health care, wages, factory work rules and other issues in recent years, including as part of last year's labor talks on new national contracts.
Eliminating the program entirely would be a tough sell for Gettelfinger, who is unlikely to support any change that would put these workers out on the street. Additional buyouts remain an option, but the idea of nearly bankrupt automakers paying idled workers to leave is also likely to draw sharp criticism from some in Congress.
Michigan to lose more than 100,000 jobs next year, say U-M forecasters
www.jobberz.com
Jaclyn Trop / The Detroit News
ANN ARBOR -- Michigan will lose even more jobs in 2009 than the 81,000-plus that have vanished already this year, and won't see an gains in hiring until sometime in 2011, according to a new economic forecast released today.
A total of 108,000 jobs will be lost next year in the state, according to a survey released today by economists at the University of Michigan's Research Seminar in Quantitative Economics. They predict state unemployment will exceed 10 percent in each of the next two years -- the highest rate since 1984. And while the economists expect some form of a government-approved rescue package for Detroit's Big Three automakers, they forecast that by 2010 the auto industry will employ less than a third of the workers it had a decade earlier.
The nationwide economic recession coupled with the precarious position of the Big Three automakers is a "troublesome gateway to the year ahead," according to U-M economist George Fulton.
"The potential consequences of myriad alternatives are impossible to predict at this point, but none of them is any good fro Michigan," Fulton said. "The hard times are here to stay."
The first half of 2009 will be especially rough for the already suffering auto, construction and retail sectors. Fulton and colleague Joan Crary forecast that the state will lose 53,000 manufacturing jobs next year and another 24,000 in 2010, with about two-thirds coming from the auto industry. Michigan already has lost 74,000 manufacturing jobs during the past two years.
After enduring an eight-year stretch of job losses tracing back to mid-2000, the state economy now faces the confluence of a U.S. economy in recession and the very real fear of bankruptcy among major players in its core industry: domestic automobile manufactures, Fulton added.
Fulton and Crary made the presentation during a two-day economic outlook session attended by more than 200 academics and analysts.
They said, though, that a surprising number of small, non-auto-related businesses continued to grow. They include agriculture and chemical and medical businesses. In fact, education and health services -- the only industry sector expected to see employment gains -- will gain 22,000 jobs during the next years, they said.
Although the economists said they expect 2010 will be "much better" than 2009, modest job gains aren't expected across the board in the state until sometime in 2011.
Jaclyn Trop / The Detroit News
ANN ARBOR -- Michigan will lose even more jobs in 2009 than the 81,000-plus that have vanished already this year, and won't see an gains in hiring until sometime in 2011, according to a new economic forecast released today.
A total of 108,000 jobs will be lost next year in the state, according to a survey released today by economists at the University of Michigan's Research Seminar in Quantitative Economics. They predict state unemployment will exceed 10 percent in each of the next two years -- the highest rate since 1984. And while the economists expect some form of a government-approved rescue package for Detroit's Big Three automakers, they forecast that by 2010 the auto industry will employ less than a third of the workers it had a decade earlier.
The nationwide economic recession coupled with the precarious position of the Big Three automakers is a "troublesome gateway to the year ahead," according to U-M economist George Fulton.
"The potential consequences of myriad alternatives are impossible to predict at this point, but none of them is any good fro Michigan," Fulton said. "The hard times are here to stay."
The first half of 2009 will be especially rough for the already suffering auto, construction and retail sectors. Fulton and colleague Joan Crary forecast that the state will lose 53,000 manufacturing jobs next year and another 24,000 in 2010, with about two-thirds coming from the auto industry. Michigan already has lost 74,000 manufacturing jobs during the past two years.
After enduring an eight-year stretch of job losses tracing back to mid-2000, the state economy now faces the confluence of a U.S. economy in recession and the very real fear of bankruptcy among major players in its core industry: domestic automobile manufactures, Fulton added.
Fulton and Crary made the presentation during a two-day economic outlook session attended by more than 200 academics and analysts.
They said, though, that a surprising number of small, non-auto-related businesses continued to grow. They include agriculture and chemical and medical businesses. In fact, education and health services -- the only industry sector expected to see employment gains -- will gain 22,000 jobs during the next years, they said.
Although the economists said they expect 2010 will be "much better" than 2009, modest job gains aren't expected across the board in the state until sometime in 2011.
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