GM Offers Voluntary Buyouts to 18,000 Employees

Recently, GM announced that profits were up 25 percent for the third quarter and that net income was an impressive $2.5 billion. And yet, despite its strong position, Automotive News reports that GM plans to offer about 18,000 employees a voluntary buyout. The offer will only be extended to salaried employees who have worked at the company for at least 12 years, and eligible employees have until November 19 to decide whether to accept or not.

But why would GM reduce its workforce when it’s doing so well? With sales in the U.S. and China slowing down, hybrid and electric vehicles growing increasingly popular, and automated driving technology finding its way to more vehicles, GM sees a lot of change on the horizon. It’s also worried about the potential for another recession, and it wants to act ahead of the next economic downturn.

“We are doing this while our company and economy are strong,” GM told Automotive News in an email. “The voluntary severance program for eligible salaried employees is one example of our efforts to improve cost efficiency.”

What happens if too few employees accept the buyout? The company hasn’t said how large a staff reduction it’s looking to make, but it’s possible some employees may find themselves laid off involuntarily. “We will evaluate the need to implement after we see the results of the voluntary program and other cost reduction efforts,” GM told Automotive News.

Source: Automotive News (Subscription required)

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