By now, you might have heard the news. General Motors (GM) is planning to cut 30,000 jobs and close 9 plants.

General Motors Corp. will eliminate 30,000 manufacturing jobs and close nine North American assembly, stamping and powertrain plants by 2008 as part of an effort to get production in line with demand and return the company to profitability and long-term growth.

The announcement Monday by Rick Wagoner, chairman and CEO of the world’s largest automaker, represents 5,000 more job cuts than the 25,000 that the automaker had previously indicated it planned to cut.

GM said the assembly plants that will close are in Oklahoma City, Lansing, Mich., Spring Hill, Tenn., Doraville, Ga., and Ontario, Canada. A shift also will be removed at a plant in Moraine, Ohio.

An engine facility in Flint, Mich., will close, along with a separate powertrain facility in Ontario and metal centers in Lansing and Pittsburgh.

Wagoner said GM also will close three service and parts operations facilities. They are in Ypsilanti, Mich., and Portland, Ore. One other site will to be announced later.

Don’t you find it odd that GM (and other U.S. automakers) felt they had to bribe you, the American consumer, to buy their product, instead of focusing on producing a quality product that you would choose to buy based on your own comparison of the choices available to you?

According to GM, they want to cut up to $7 billion in costs before the end of 2006. While I won’t begrudge them for wanting to cut costs, I think it is appalling that they are even considering cutting jobs. Especially when you look at the numbers.

As we all know, GM has been offering great incentives to buy their cars. In fact, the incentives in September and October were so good, consumers purchased 344,797 GM vehicles in September and 253,536 GM vehicles in October for a total of 598,333 vehicles in the previous two months.

According to The Detroit News Autos Insider, the average incentive for a GM vehicle is $4,102.

GM hiked incentives after the September 11 attacks and they have since risen to $4,102 per vehicle, on average — compared with $2,976 for the overall industry and $1,542 for leading Japanese automakers, according to Autodata Corp.

Using these numbers, GM has “given away” $2,454,361,966 since September 1st. That’s 2.45 BILLION dollars!!! In two months! Imagine how much they have simply given away since “employee discounts” were passed on to the consumer beginning in June. If they want to cut $7 billion in cost, I just found 35% of it in the last two months.

Now, let’s look at those GM jobs.

According to Free Money Finance, the average GM worker makes $153,358 per year ( $76,877 in salary PLUS benefits)

“In 1977, hourly wages without benefits were $9.64 and with benefits they were $12.56. In 2004, hourly wages without benefits were $36.96 and with benefits they were $73.73.”

Let’s do a little math here:

40 hours per week x 52 weeks per year = 2,080 hours per year

2,080 hours per year x $36.96 = $76,877 (This is what the average GM worker makes without benefits. Not bad. Not bad at all. It’s a lot more than I would have imagined for factory work, but it’s not outrageous. Yet.)

2,080 hours per week x $73.73 = $153,358 (This is what the average GM worker makes with benefits.)

GM is trying to convince their employees, and the American people, that they need to do away with 30,000 jobs and 9 plants to “increase profitablity” within their corporation. I wonder if anyone has stopped to realize that the $2.45 billion dollars they gave away in September and October alone, would pay the YEARLY salary ($76,877) for 31,925 employees or the YEARLY salary PLUS benefits ($153,358) for (plus benefits) for 16,004 of those employees.

Does it really make sense to offer such incentives for buyers when you are screwing the very employees whose discounts wont mean shit if they no longer have a job?

Other Sources In The News:

GM to Eliminate 30,000 Jobs
GM’s employee-discount offer on new autos pays off
As goes General Motors
U.S. Auto Sales Table for October 2005

Other Sources In The Blogosphere:

GM to cut 30,000 jobs
Shrinking Giant, Winking Banker
GM In Full Retreat

Technorati Tags: GM, Employee Discounts, Job Cuts, Oklahoma City, Lansing Michigan, Spring Hill Tennesee, Doraville Georgia, Moraine Ohio, Ontario Canada, General Motors, 2006, layoffs, benefits, incentives

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