GM’s Pre-Congress Hail Mary… Cuts & Hikes (GM)

By Douglas A. McIntyre Published Feb 10, 9:04AM EST

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General Motors Corp. (NYSE: GM) is doing almost whatever it can to get aggressive in cost cuts and streamlined operations ahead of its first post-bailout review next week. Some of the cuts were known, and some are much greater than expected.

GM (GM) now says that it expects a rise in production in the second quarter from a lower target in Q1. This might catch many bears and doom and gloomers off guard, but the company said specifically that this is not a signal of demand recovering. This is more to an “inventory balancing.”

The company is also cutting its salaried positions by 10,000 down to a level of 63,000. Some of this was telegraphed in December and more recently, but that is more than 10% of the workforce and more than many would have guessed. It looks like 3,400 of those cuts are US-based cuts and most will be made by May 1.

There also appears to be some temporary pay cuts for a majority of salaried employees. That will take place from May 1 to Year-End.

This has shares up 2.5% at $2.90 in early trading.

Jon C. Ogg
February 10, 2009

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.