• Apr 23rd 2009 at 8:56AM
  • 32
This is what bringing a behemoth back down to the proper size looks like. General Motors is looking for every way to conserve its ever thinning supply of money, and while April sales were better, the overall picture is decidedly grim.

In a move to conserve resources and hopefully help clear up any inventory buildups, AFP is reporting that The General plans to idle most of its domestic plants this summer – for as long as nine weeks. GM is expected to let its employees know first before any official statements are made, but it is believed that the work stoppage will coincide with GM's normal July shutdown, though there could be staggered closures as early as May.

If GM does put its operations into a large-scale hover, it may have a ripple effect on suppliers, many of whom are also holding on by the slimmest of margins. Will the summer be a season of cascading furloughs and bankruptcy announcements? Let's all take a deep breath as we wait to see.

[Source: AFP]

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    • 1 Second Ago
      • 6 Years Ago
      It is better to be shutdown for nine weeks rather than be shutdown permanently. Hopefully the workers will understand that.
      • 6 Years Ago
      Close 13 plants and then pay the workers with the 5 billion in tarp.
      Workers get 95% of their pay to sit home for 13 weeks and do nothing
      and the working taxpayer pays for this.. I wonder why GM is in
      trouble!!!! FILE Chap 11 now and void the contracts

      • 6 Years Ago
      Here is a wild idea... if they want to save money while shut down...

      Don't pay anyone! I'm only 27 years old, but I was raised that if I don't work, I don't get paid. Yeah sure they are "only" getting maybe 70% of their full pay, but they are sitting at home doing nothing.

      It might hurt, but it seems like in this dire situation, it needs to chop off its left foot (the union) so it can actually make progress towards saving money. How does idling a plant for 2+ months and still paying everyone save tons of money?

        • 6 Years Ago
        No machines running, turn off most of the lights, etc. You'd save a lot too if you turned off all your appliances and lights in your house for a month!

        That being said, if I wouldn't be sitting at home, I'd be looking for a new job...

        if i could find one.
        • 6 Years Ago
        They don't pay workers during the shutdown. That's pretty much the whole point. The hourly workers don't get paid because they are not clocking in/out, some of the salaried workers get paid, most do not. Workers are encouraged to take vacation time during the shutdown so they get paid as vacation time at least. However, many workers prefer to go on unemployment instead, which GM doesn't like because it costs them money.
        • 6 Years Ago
        Exactly, I'd be job searching like crazy. My interviews would be lined up for the 1st month.

        I feel bad for those that live in or moved to a relatively small community were GM's plant is the ONLY descent place to work.
      • 6 Years Ago
      This sounds like part of their preparation for bankruptcy.
      • 6 Years Ago
      They're going to be getting paid (albiet not 100% pay... more like 70 to 90%), so it's not like they're getting left high and dry by the company.

      A 9-week vacation, with 70% pay? I'd take that in a heartbeat.
      • 6 Years Ago
      I think I have the best solution for the company (and all others)...

      1) Cut down to as few plants as possible, located strategically (V8 plants located near truck plants). As in Chrysler's case, they may only sell less than 1 million units a year, but they have capacity for something like 2.5 million plus....way to much.

      2) Have capacity to provide average demand capacity with 2 shift/4 day work week...any further demand can be filled with overtime, adding temporary third shift or working extra days (go to 5 or 6 days) as demand requires.

      This will allow them to be smaller, mean companies that don't get over bloated.

      The issue of legacy costs is a hard one. How do you continue to pay boat anchor legacy retirement costs when you market share is eroding? Too many new players have come in to the picture and eaten market share...it's inevitable.
      • 6 Years Ago
      Man, I would love a 2 month summer furlough unpaid. At 70% pay, well, I can't think of any better way to spend the summer. I am SO jealous.
      • 6 Years Ago
      and Chrysler will announce they are shutting down permanently.
      • 6 Years Ago
      It's not just the union people that are affected. The low sales have led to many lay-offs of white collar people in areas like finance, engineering, purchasing, marketing. Many people I used to work with at GM were let go yesterday. They might get a little bit of severance, but they don't benefit from union pay during shutdowns. It's really sad.
      • 6 Years Ago
      I hope everyone realizes that ALL of the large car manufacturers will probably have to do something similar (some more than others of course).

      Other than Hyundai (fleet sales) and a few smaller manufacturers, sales are down to basically 2/3 of previous years. That means that without slowing down production, everyone would have to stop production for at least 17 weeks.

      I would guess everyone will have to shut down production of most plants an average of 4 - 6 weeks this year.
        • 6 Years Ago
        actually this isnt true. most of the major OEMs do a little thing called 'production planning' which takes into account inventory levels, sales trends, line rate at the plants etc...
        the smart companies positioned themselves in a way that they have been lowering the line rates over the previous year, and realigning production with where it needs to be to support actual demand (crazy concept...i know). GM has more 'days supply' of anyone... to the tune of several vehicles actually have almost 2 years of supply already on the ground! Summer shutdown happens regardless of how well or poorly sales are (usually 2-3 weeks for all plants to retool, maintenence, updates, etc.). So no, everyone will not be doing what GM is doing. Ford for example has the typical 2-week summer vacation for it's plants (staggered) with some plants being down for 3 weeks. What GM is doing is purely reactionary to the simple fact they have 2 years of cars on the ground and no one buying them. in the production planning world, this could have been avoided by trimming production months and months ago, rather than freaking everyone out by shutting down for 2 months. it is insane.
      • 6 Years Ago
      Amazing!! This post doesn't get censored....
      • 6 Years Ago
      It's only April 23 where I live. How do they know how April sales will end up?
        • 6 Years Ago
        Looking at the sales data from the first 20 days of April, I'm sure that GM will be able to forecast reasonably well the sales from the remaining 11 days.
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