Gm To Impose Wage Cuts & Job Cuts

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UNITE union officers met with General Motors bosses on Thursday, to discuss the future of the company’s Luton plant.

The 1,400 workers at the Kimpton Road van manufacturing factory returned to work on Monday after three weeks, to hear that GM Europe is looking for $750 million cuts, and immediately a 10 per cent cut in labour costs.

At the GM car plant in Ellesmere Port, Cheshire, workers have been urged to apply for ‘sabbaticals’ of between two and eight months this year, during which they would receive just 30 per cent of their pay.

A series of ‘down days’ took place at the Luton plant between September and Christmas last year and on their return this week workers were informed there would be three more of these.

GM Europe President Carl Peter Forster stated in an article in the December issue of GM Mirror, the magazine for GM in the UK and Ireland, that the company and the unions have formed ‘working groups’, to discuss ‘structural costs’.

Forster wrote: ‘We’ve been working very hard to reduce structural costs as a percentage of revenue in our current labour agreements and many good and constructive ideas have been advanced over the past few months.’

He continued: ‘In order to have a viable business, we have no other option than to attack structural costs aggressively to bring costs in line with the lower levels of demand.

‘So far, we are not contemplating head count reductions, but will try to achieve our structural costs goals through other measures.

‘Over the last month, management and employees’ representatives have held several meetings in order to address this situation.

‘We have launched working groups in every country and function with the objective of achieving a minimum 10 per cent labour cost reduction in all areas of the business.

‘We will be focusing on three areas to deliver the necessary savings – wages, work time reduction and other labour costs related initiatives.

‘We will keep you informed about the progress on these discussions.

‘Meanwhile, I want to be very clear – this approach will inevitably require some sacrifice from all of us.

‘But I must also warn that if the market conditions in Europe continue to deteriorate beyond the current levels, more will be needed to be done to keep our business viable.’

At the end of Thursday’s cabinet meeting in Liverpool, Business Secretary Peter Mandelson said that there would be no government support for the car industry in Britain, without ‘restructuring’.