General Motors announced it would offer buyouts to 18,000 salaried employees in North America with 12 or more years of experience, shortly after it released strong third-quarter financial results, with a 10.2-percent profit margin on earnings of $2.8 billion in North America alone last quarter.
The automaker notified employees of the voluntary severance program as part of a cost-savings effort to brace for an industry downturn and free capital for future technologies.
CEO Mary Barra said GM would be taking “steps to transform the workforce to ensure we have the right skill sets for today and the future while also driving significant efficiency.”
“We are doing this while our company and economy are strong,” said a GM statement. “The voluntary severance program for eligible salaried employees is one example of our efforts to improve cost efficiency.”
The company also said it would “evaluate the need to implement” other forms of layoffs after evaluating results of the voluntary program and other cost reduction efforts.
GM also has been making a push toward developing self-driving vehicle technology, electric vehicles and ride sharing services.
The last time GM offered buyout packages to salaried workers was in 2009, when the automaker was in a bankruptcy that claimed four of its eight U.S. brands, closed plants and almost forced the automaker to abandon its Detroit headquarters.
The news that GM is decimating its workforce was well received on Wall Street, as shares in the company went up more than 9 percent to close at $36.58.
GM employed around 180,000 people in 2017, down from 225,000 in 2016, so the job cuts would mean about a ten percent reduction in the firm’s workforce.
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