About 47,600 hourly workers have decided to leave General Motors Corp (GM) and Delphi Corp through buyout or early retirement offers, accelerating the distressed companies' plans to cut costs by paring their work forces.
At GM, where about 35,000 people will depart -- mostly through early retirements -- chairman and CEO Rick Wagoner said he was surprised by the numbers. But he said the number of takers will allow the Detroit company to reach its target reduction of 30,000 manufacturing jobs by Jan. 1, two years ahead of schedule.
GM previously announced plans to cut its 113,000-person US hourly work force by 30,000, closing a dozen plants by 2008.
Delphi, GM's former parts operation that is now a separate company, also said on Monday that about 12,600 employees represented by the United Auto Workers union took early retirement offers at the automotive parts supplier, which filed for bankruptcy protection last October. Some Delphi workers also have an additional buyout offer on the table with deadlines that are more than a month away.
Based on preliminary numbers from GM, about 4,600 employees accepted buyouts and about 30,400 chose to retire. It is expected that most will retire or leave the company by the end of the year, GM said.
GM offered buyouts of US$140,000 for workers with at least 10 years of service, while those with less than 10 years would receive US$70,000. The workers would cut nearly all ties with the company except for vested pension benefits.
The automaker also offered an early retirement option to workers with at least 26 years of service. Normally, employees can retire at 65 years of age or 30 years of service.
Delphi workers were offered a similar early retirement incentive. But Delphi's effort to buy out some employees still needs bankruptcy court approval.