GM lays off several hundred salaried employees

Tuesday, March 28th 2006, 10:12 am

By: News On 6

DETROIT (AP) _ General Motors Corp., pummeled by falling U.S. sales and billions in losses, said Tuesday it is laying off hundreds of U.S. salaried workers as part of a plan to bring its North American operations back to profitability.

GM spokesman Robert Herta said he couldn't give an exact figure, but said the cuts involve fewer than 500 workers at 30 locations across the United States, including factories and engineering centers.

A cut of just under 500 jobs would represent about 1.3% of GM's U.S. salaried work force of 36,000. The world's biggest automaker has said it plans to cut 7% of its salaried work force this year, so more cuts are on the way.

GM shares rose 20 cents to $23.13 in morning trading on the New York Stock Exchange.

Dave Kepsel, an engineering manager who spent 26 1/2 years at GM, was among those laid off Tuesday.

``I was told today I no longer have a job with GM,'' said Kepsel, a 52-year-old from Lake Orion who works at GM's massive technical center in the Detroit suburb of Warren.

Kepsel said he wasn't surprised by the layoffs and thought they might have come sooner because of GM's struggles.

``It's one of those things. It's part of doing business. I don't have any hard feelings,'' he said.

Kepsel drove away in a Chevrolet Silverado, a company vehicle he'll be allowed to keep for 30 days.

``At least they offered me that and didn't make me walk home or take a taxi,'' Kepsel said.

Detroit-based GM announced a restructuring plan last fall in the face of mounting losses. Under the plan, GM wants to cut 30,000 U.S. hourly workers and close 12 facilities by 2008. GM lost $10.6 billion in 2005, largely because of declining sales and rising costs in North America.

The layoffs are GM's second major jobs-related announcement in a week. GM on Wednesday said it would offer buyouts to its U.S. hourly workers of between $35,000 and $140,000 as part of the plan to cut its hourly work force. GM currently has 113,000 hourly workers. Salaried workers aren't eligible for those buyouts.

GM's severance packages for salaried workers vary by position and level of experience, but employees generally receive one month of severance pay for each year of service at the automaker up to a maximum of 15 months. They also will continue to receive health benefits and will be eligible for outplacement assistance during that time, Herta said. Salaried workers with company vehicles will be able to keep those vehicles for a period of time.

``We're trying our best to treat these impacted individuals with dignity and respect,'' Herta said.

GM has been steadily shrinking over the last few years as U.S. demand for its vehicles has fallen. The company had 44,000 salaried workers in 2000. GM reduced its salaried payroll by around 2,000 workers last year.

This is the second round of cuts to GM's white-collar work force this year. The automaker laid off 500 contract employees in January, many of them engineers and designers at its technical center in Warren. Contract employees do work for GM but are employed by another company. Tuesday's layoffs only included GM salaried workers.