In the largest corporate buyout program ever, General Motors (GM) has offered its entire hourly workforce up to $140,000 to call it quits.
Friday (June 23) is the deadline for some 113,000 workers to decide whether they want to keep their jobs or walk away with an incentive package to help GM slash costs. Some 30,000 employees have already taken the bait.
Former GM employee Jonathan Silvers returns to Michigan to find out what happens when an entire generation of autoworkers is asked to leave so their company can survive.
Silvers found that weeks after the deal was announced, the buyout was already reshaping the future of employees, the company, and the community.
"If you don't take the buyout and your contract renews, especially with GM going slowly down the way it is, you're going to lose your guaranteed income probably in 2007," John Weizman, a GM worker, told NOW.
Weizman, who has moved for the company five times in 10 years to stay ahead of plant closures, earns $28 per hour as a service parts operator. He has decided to take the company's offer and leave Michigan.
"I'm really tired of moving around. I have lost my family along the way. That's what happened to a lot of families," he says.
Scheduled GM plant closings to 2008 The buyout comes at a critical time for GM as losses have spiraled out of control. In 2005 the company lost $10.6 billion while Toyota became the world's most profitable automaker. Like many other manufacturing companies in America, GM has been plagued by high labor costs.
What's driving the buyout is the company's need to reduce its $5 billion annual health care burden. If you buy a GM vehicle, about $1500 of the sticker price goes into insuring present and past employees along with their families.
Sean Macalinden of the Center for Automotive Research blames poor decision-making by management for many of the company's problems.
"They've guessed wrong on the market. They've guessed wrong on fuel costs, economy and consumer reaction to that price," he says. Macalinden goes on to say that the company also guessed wrong on styling, branding, marketing, advertising, and its handling of dealerships.
The biggest employer buyout in American history and the legacy it leaves behind. Next time on NOW.Close