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October 17, 2007
General Motors Corp. will lay off 767 workers at its Hamtramck assembly plant because of lagging demand for two of its high-end sedans, the automaker said Tuesday.
GM will cut one of two shifts at its Poletown plant starting Dec. 14. The factory builds the Buick Lucerne and Cadillac DTS, both of which have taken a hit in sales this year.
The cuts come in the wake of a new landmark labor pact with the United Auto Workers that secures job commitments for many of GM's U.S. assembly plants. The deal locks in future work, but makes no promises in terms of how many shifts will run and how many workers can stay.
GM spokesman Tom Wickham said an announcement was broadcast to workers Tuesday morning at the plant, which employs about 1,800 hourly workers. GM also notified state officials of its plans.
The laid-off workers could eventually fill other openings within the company, Wickham said.
The Hamtramck plant was among those guaranteed work under GM's new, four-year labor pact with the UAW. GM made the commitments in exchange for major concessions from the UAW, including the creation of a second-tier of lesser-paid factory workers.
Under the agreement, the Poletown plant gets a new midsize Chevrolet car and what is expected to be a seven-passenger crossover SUV. GM also said it will build the Chevrolet Volt, the automaker's ambitious attempt at a plug-in hybrid, at the plant should the car become a reality.
About 62 percent of workers at the Hamtramck plant voted in favor of the deal.
"GM has a truly unbelievable knack of symbolism at the worst moment," said labor expert Harley Shaiken of the University of California Berkeley.
He said workers at Chrysler LLC and Ford Motor Co., which are still working to secure new labor contracts with the UAW, are watching the situation at GM closely.
In outlining the labor contract to Wall Street on Monday, GM assured investors that despite the product commitments the deal leaves flexibility for workforce adjustments.
GM, which lost $12 billion in the last two years and ceded market share to foreign rivals, is trying to get its production more in line with consumer demand. The company is in the midst of a massive restructuring plan that calls for closing a dozen North American facilities by 2008.
GM needed to scale back production of the Lucerne and DTS. Lucerne sales are down 15 percent this year through September; DTS sales fell 14 percent.
The layoffs in Hamtramck follow GM's decision to cut an unspecified number of jobs at the Pontiac factory that builds GMC Sierra and Chevrolet Silverado pickup trucks, which have struggled in a tough market.
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