General Motors Cutting 2,000 More Jobs
DETROIT (AP) -- The worsening U.S. auto sales slump claimed another 2,000 workers Friday as General Motors Corp. announced layoffs at three more car factories.
The company said it will cut shifts at car factories in Lordstown, Ohio; Orion Township, Mich.; and Oshawa, Ontario, starting in February due to slowing demand for their products.
"It's all market driven, as all of our changes have been of late," spokesman Chris Lee said.
The layoffs amount to 2.4 percent of GM's North American blue-collar work force of 84,000. So far this year, GM has announced 11,000 factory worker layoffs in the U.S.
The latest cuts were announced as a Congressional committee heard a second day of testimony from GM, Ford Motor Co. and Chrysler LLC executives seeking a government bailout of up to $34 billion to keep the U.S.-based automakers from collapsing.
In Lordstown, where GM makes the Chevrolet Cobalt and Pontiac G5 small cars, 890 workers will go on indefinite layoff starting Feb. 2 when GM ends a third shift at the sprawling complex. The shift was added earlier this year when gas prices hit $4 per gallon and demand for small cars skyrocketed.
The cuts are in addition to 1,100 layoffs at Lordstown announced last month.
"It seems like every time you wake up more good news hits you," said a frustrated Jim Graham, president of UAW Local 1112, which represents Lordstown assembly plant workers.
Also Feb. 2, GM will lay off 390 workers by cutting a third shift at the Orion plant near Pontiac. The factory makes the Chevrolet Malibu and Pontiac G6 midsize sedans. The Malibu had been GM's hottest seller, but demand has started to wane in recent months. No date has been set to bring the workers back because GM doesn't know when sales will return.
Another 700 workers will go on indefinite layoff Feb. 9 in Oshawa, Ontario, where GM makes the Chevrolet Impala large sedan. The company is cutting the third shift, also due to slowing demand, Lee said.
GM also is adding several weeks of down time to the normal two-week holiday shutdown that will essentially keep the Lordstown and Orion plants closed from late December through the month of January.
When workers return in February, the Lordstown assembly and fabricating plants, which employ about 4,800, will have 2,000 fewer workers.
"There's not much anybody can do. We're trying to keep the spirits up of everybody in the plant," Graham said. "It's getting tougher and tougher because they see what's going on in Washington."
In addition, GM is adding a week of down time at its Malibu and Saturn Aura plant in Kansas City, Kan., keeping it closed for three weeks in January. When workers return Jan. 26, the assembly line speed will be slowed, Lee said.
GM's U.S. sales fell 41 percent in November when compared with the same month last year, and they are down 22 percent for the first 11 months of the year.
Overall, U.S. sales were off 37 percent in November, the worst level in 26 years, and were down more than 16 percent so far this year.
Automakers have blamed tight or nonexistent credit, economic woes and a lack of consumer confidence for the slump, and they aren't predicting much of a recovery in 2009.
Many of the laid-off workers will get state unemployment benefits plus supplemental pay from the company that adds up to about 95 percent of their base pay, for 48 weeks. Beyond that, their pay is in doubt because the United Auto Workers union has agreed in principle to eliminate the jobs bank, which would have given them most of their pay for up to two years.
Some of the workers, recent hires who work for $14 per hour, about half the hourly rate of an older UAW worker, will get only state unemployment benefits, Lee said.
GM shares fell 13 cents to $3.98 in afternoon trading Friday. They have traded in a range of $1.70 to $29.28 over the past year.
Associated Press Writer Joe Milicia in Cleveland contributed to this report.