February 10, 2009 at 10:57 AM EST
GM cuts 10,000 jobs
General Motors said on Tuesday that it will cut its global work force by nearly 10,000, or 14 percent, this year and impose pay cuts on most of the remaining jobs
(IBTimes) -- 02/10/2009 --

General Motors said on Tuesday that it will cut its global work force by nearly 10,000, or 14 percent, this year and impose pay cuts on most of the remaining jobs.

The bailed out car maker, who is scrambling to cut costs and restructure, will cut its workforce to 63,000 from 73,000 during the year.

In the US market , about 3,400 of 29,500 white-collar jobs will be cut. Most jobs will be cut by May 1, and most remaining U.S. staff will see pay cuts of between 3 percent and 10 percent for the year, GM said.

The restructuring is the latest move the struggling car maker is taking as it approaches the February 17 deadline to submit a plan to the US government.

"These difficult actions are necessitated by a severe drop in vehicle sales worldwide and by the need to restructure GM for long-term viability," GM said in a statement.

GM said U.S. executive pay would be cut by 10 percent for the rest of 2009. Other salaried U.S. workers will face pay cuts of between 3 percent and 7 percent, it said.

GM's sales in January plunged by 49 percent and the automaker has said it expects industrywide U.S. sales to be near 10.5 million vehicles in 2009, extending a four-year slump that has taken the market to the lowest levels since the early 1980s.

As a result, GM executives have said the company is looking for deeper and faster cost-cutting under the restructuring plan that will be submitted to the U.S. Treasury under terms of its $13.4 billion bailout.

The automaker is also negotiating with bondholders and the United Auto Workers union for concessions and it is planning to close several factories. To prove its viability, it must show an ability to repay the loans and prove "positive net present value."

GM has offered buyouts to its U.S. workers represented by the United Auto Workers union, but remains in talks.

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