General Motors GM buyouts cut North American salaried workforce

The GM logo is seen at the General Motors Lansing Grand River Assembly Plant in Lansing, Michigan October 26, 2015.Rebecca Cook/Reuters

• General Motors Co said on Wednesday it plans to cut its North American salaried workforce, starting with voluntary buyout offers but resorting to layoffs if necessary.
• Following a report of its third quarter profits that exceeded Wall Street estimates, the Detroit-based automaker told its salaried employees of the decision.
• In a statement, General Motors said “the voluntary severance program for eligible salaried employees is one example of our efforts to improve cost efficiency.” 

General Motors said on Wednesday it plans to cut its North American salaried workforce, starting with voluntary buyout offers but resorting to layoffs if necessary.

Following a report of its third quarter profits that exceeded Wall Street estimates, the Detroit-based automaker told its salaried employees of the decision.

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In a statement General Motors said that the carmaker has “been on a journey to transform the company, both in how we operate the business and in how we lead in the future of mobility.”

It added: “Even with the positive progress we’ve made, we are taking proactive steps to get ahead of the curve by accelerating our efforts to address overall business performance. We are doing this while our company and economy are strong. The voluntary severance program for eligible salaried employees is one example of our efforts to improve cost efficiency.” 

When speaking of any possibly “involuntary” actions made, GM said it would “evaluate the need to implement after we see the results of the voluntary program and other cost reduction efforts.” 

GM has been solidly profitable for years, since its recovery from bankruptcy during the financial crisis. But an auto sales boom in the US is now finishing a fourth year, and potential headwinds are developing in China, the world’s largest market. 

Under CEO Mary Barra, GM has focused on keeping its operations lean and competitive, while investing aggressively for future growth. And efforts to reduce the carmaker’s workforce don’t mean it isn’t hiring. On a call with analysts after Q3 earnings were announced, Barra said that GM plans to spend $1 billion in 2018 on it Cruise self-driving unit, with new talent making up a notable aspect of the millions it has remaining to commit.

Ford has also announced cuts in its salaried workforce, under CEO Jim Hackett.