Tuesday, July 15, 2008

GM Death Watch

GM had a press conference today. According to the New York Times:

DETROIT — General Motors said Tuesday that it would reduce labor costs for salaried workers by 20 percent, eliminate its quarterly dividend and further reduce truck production to ensure that it has enough cash to finance its turnaround for at least two more years.

The moves, which include selling at least $2 billion in assets and borrowing as much as $3 billion, are expected to raise about $15 billion by the end of 2009, the chief executive Rick Wagoner said.

Mr. Wagoner said the automaker would stop providing health care coverage to salaried retirees at age 65, offer buyout and early retirement packages to reduce its salaried work force and freeze base pay for salaried employees through 2009.

In addition, G.M. executives will no longer receive discretionary cash bonuses.

“These are tough but necessary actions,” Mr. Wagoner said ....

No word about whether they're going to produce less oil-dependent vehicles. Maybe it hasn't occurred to him yet?

I guess after the "two more years" they'll open a bicycle repair shop.

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