GM, Chrysler seek billions more, plan additional job cuts
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General Motors and Chrysler, which have received $17.4 billion of public funds so far, have more than doubled that request to a total of $39 billion.
The requests were made in government-required restructuring plans filed Tuesday, according to the Associated Press. The companies also plan to make thousands of additional job cuts, slash models and brands, and seek union concessions.
Acknowledging that conditions in the U.S. auto industry have grown significantly worse in two months, GM said it would cut 47,000 jobs globally — 19 percent of its work force — by the end of the year. It also said it would close five more unidentified U.S. factories.
Chrysler said it will cut 3,000 additional jobs and stop producing three vehicle models.
The grim reports came as the United Auto Workers union said it had reached a tentative agreement with GM, Chrysler and Ford Motor Co. on contract changes, AP reported. Concessions with the union and debt holders were a condition of the government bailout.
GM said it could need up to $30 billion from the Treasury Department, up from a previous estimate of $18 billion. That includes $13.4 billion the company has already received. GM said it could run out of money by March without new funds and needs $2 billion next month and another $2.6 billion in April.
GM's request includes a credit line of $7.5 billion to be used if the downturn is more pronounced than expected, AP reported. But the automaker claimed it could be profitable in two years and repay its loans by 2017.
Chrysler requested $5 billion in new loans on top of the $4 billion it received in December. That's $2 billion more than expected.
Ford, which borrowed billions from private sources before credit markets tightened, has said it can survive through 2009 without government help.
GM and Chrysler plan to reduce the number of models they offer. GM said its Saturn brand could be phased out and its Saab unit could file bankruptcy this month.
The GM job cuts include 10,000 salaried and 37,000 blue-collar positions, amounting to 19 percent of its current global work force of 244,500, according to AP. Jobs outside the United States account for 26,000 of the reductions. The cuts would take place by the end of this year and more would follow.
GM said the new plan was significantly more aggressive than the one presented to the government on Dec. 2 because the global economy and auto sales had deteriorated swiftly.
Chrysler had 54,007 employees at the end of 2008, so Tuesday's cuts would equal about 6 percent of its work force, according to AP.
Chrysler said it will eliminate the Dodge Aspen, Durango and Chrysler PT Cruiser.
GM said it plans to sell or spin-off its Saturn brand. If those attempts are unsuccessful, GM will phase it out by 2011. GM also is discussing the sale of its Hummer division. The automaker also has sought buyers for its Saab unit. Selling or eliminating those brands would leave GM to focus on Chevrolet, Cadillac, GMC and Buick, with Pontiac reduced to one or two models, according to AP.
GM would also reduce the number of vehicle models, dropping the nameplates from 48 in 2008 to 36 by 2012. All of GM's major U.S. vehicle launches from 2009 to 2014 would be high-mileage cars and crossovers.
Terms of the union deal were not announced, but UAW President Ron Gettelfinger said in a statement that they "will help these companies face the extraordinarily difficult economic climate in which they operate."
GM and Chrysler's loan terms require them to make their labor costs competitive with those at Japanese automakers' U.S. factories.
