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Local GM payroll to drop

JANESVILLE — An attrition program and planned production cuts mean the General Motors assembly plant in Janesville soon will operate with between 1,150 and 1,200 hourly workers—1,300 fewer than it did just weeks ago.

GM said Thursday that 574 employees will leave the plant by July 1 under an early retirement/cash buyout.

The automaker also announced that it will lay off 96 more employees as the plant switches to one-shift production of full-size sport utility vehicles in July.

That's on top of GM's previously announced intention to lay off 756 workers when it eliminates its second shift. The nearly 100 new layoffs are the result of GM's decision to slow the assembly line from 58 jobs per hour to 44 on the one shift.

Major GM suppliers in Janesville such as Lear Corp. and LSI also will lay off employees. In anticipation of production cuts at GM, Lear said it would lay off 336 of its 660 hourly workers, while LSI planned the same for 132 of its 235 employees.

From a tenure standpoint, the layoffs of 852 people will be far reaching. Union officials estimated that workers hired after September 1986—some with nearly 22 years of experience—will be laid off.

Just weeks ago, the Janesville plant had about 2,500 hourly employees working on two shifts to build 880 SUVs a day. When production resumes on July 14 after the plant's annual two-week shutdown, the one-shift operation will build 440 trucks a day.

The stability and duration of that production rate is uncertain, as the pickup truck and large SUV markets continue to be battered by high gas prices and a slumping economy.

For their part, GM officials don't expect the market to rebound. Citing a consumer shift from big trucks to more fuel-efficient cars, they announced earlier this month that the Janesville plant and three others will close by 2010 at the latest.

The market, they said, will dictate how long the Janesville plant remains open.

As gas prices move beyond the $4 per gallon mark, the nation's GM dealers are reporting bulging inventories of the trucks built in Janesville and Arlington, Texas, which will ultimately become the automaker's lone producer of full-size SUVs.

At the end of May, dealers reported a 141-day supply of Chevy Suburbans, a 124-day supply of Chevy Tahoes, a 216-day supply of GMC Yukon XLs and a 198-day inventory of GMC Yukons.

Typically, dealers prefer a 60- to 65-day supply.

On a national basis, GM spokesman Chris Lee said Thursday that 17,398 hourly workers participated in the recent retirement/buyout plan that was offered to 74,000 employees in February. An additional 1,259 workers who retired between October and the February offering were grandfathered into the program for a total of 18,657 workers no longer on the active GM payroll.

SPECIAL ATTRITION PROGRAM

General Motors and the United Auto Workers announced in February a special attrition program offered to all of GM's 74,000 UAW-represented employees. The automaker said Thursday that 574 of the plant's 2,200 hourly workers accepted one of these offers and will leave the plant by July 1.

The options:

-- For employees with 30 years of service, GM offered incentives of $45,000 for production workers and $62,500 for those in skilled trades.

Employees could take the incentives as a one-time, lump-sum cash payment; as a direct rollover to their GM 401(k) or Individual Retirement Account; as a monthly annuity, or as a combination of partial lump-sum payment and direct rollover.

Employees will keep their GM pensions and health care benefits.

-- Mutually satisfactory retirement for employees who are at least 50 years old with 10 or more years of service. This option provided a pension payment and full benefits based on the employee's age and length of service.

-- Pre-retirement program in which employees with 26, 27, 28 or 29 years of service will grow into a “30 and out” retirement. Until they reach 30 years of credited service employees receive full benefits and a fixed monthly benefit ranging from $2,750 to $2,900.

-- Cash buyout for employees who voluntarily quit and sever all ties with GM. Workers with 10 or more years of credited service or seniority will get $140,000, while workers with fewer than 10 years will get $70,000.