Corp. will reduce its salaried workforce to about 63,000 people, from roughly 73,000 worldwide, as part of its restructuring plan.
GM says the 10,000 job cuts will occur throughout this year, as signaled in the auto maker’s viability plan submitted to Congress last year.
In the U.S., GM will eliminate 3,400 of its 29,500 salaried employees by May 1. The auto maker says it will use a combination of separation programs and policies, which provide for severance payments, benefit contributions and outplacement assistance.
U.S. executive employees also will face base-pay cuts of 10%, beginning May 1 and continuing through the year, after which time GM will review the program’s success. Other salaried employees will see wage reductions of between 3% and 7%.
GM’s North American region has been hardest hit by the global recession and previous attempts to restructure through attrition have not been entirely successful.
The auto maker says it also will review compensation and benefit packages for employees in other countries.
“These difficult actions are necessitated by a severe drop in vehicle sales worldwide and by the need to restructure GM for long-term viability,” the auto maker says.
GM must submit a second viability plan to the federal government by Feb. 17, which will include concessions from stakeholders such as the United Auto Workers union and bondholders, in order to continue receiving a total of $13.4 billion in taxpayer loans to stay afloat. A final plan demonstrating its long-term viability is due March 31.