Tagged: GM

General Motors factory workers will get a record amount in profit-sharing checks this year.  The automaker's 48,000 UAW hourly workers will get at least $4,000.  That's more than twice the company's previous record for hourly worker profit-sharing  - $1,775 in 1999.

General Motors says most of its 26,000 white-collar workers will get bonus checks. The automaker says the bonuses will be between 4 and 16 percent of their base salaries. The Associated Press reports:

The company says in a statement Thursday that bonuses will be based on the performance of the worker and the company. GM made $4.2 billion in the first three quarters of last year and is expected to post a fourth-quarter profit shortly. The bonuses come just 19 months after GM needed a $49.5 billion government bailout to make it through bankruptcy protection.

The company says that more than 96 percent of the salaried workers will get bonuses of 4 to 16 percent of their base pay. Fewer than 1 percent will get 50 percent or more.

Profit-sharing checks to GM's 45,000 workers are expected to break a record. The news comes as GM is tallying its profit numbers for 2010. The company will release the amount of the checks soon.

The Wall Street Journal reports:

General Motors Co. is planning to pay its hourly workers in the U.S. at least $3,000 each in profit-sharing payouts, the largest amount ever, after the company's return to profitability in 2010, people familiar with the matter said...The auto maker is trying to tow the line between fiscal prudence and expectations that it will share recent gains with workers as the company heads into labor negotiations with the United Auto Workers.

Other U.S. automakers are also sharing the wealth.

Ford Motor Company paid hourly workers more than $5,000, "more than the company was required to pay under the profit-sharing formula in its contract with the UAW," according to the Wall Street Journal.

And Chrysler gave their workers $750 despite the company's losses in 2010.

The Detroit Free Press reports that the checks are expected to be handed out in the months ahead, and the size of the checks could help the automaker in its negotiation with the United Auto Workers union. From the Freep:

The Detroit Three, which will negotiate new labor contracts with the UAW this year, may be giving higher-than-required payments to autoworkers as part of a strategy to convince the rank and file to keep labor costs flat in return for bigger profit sharing in the future, labor experts previously told the Free Press.

Detroit automakers are preparing to send bonuses to workers around the region. Even some temporary workers will get a share of growing profits.
Terri Houldieson is technically a temp worker, or a "long-term supplemental employee." But she’ll still get a piece of Ford’s $6.6 billion profit from last year.

Workers like Houldieson should receive, on average, about $2,000 each compared to the $5,000 for regular employees.

"We’ve all put work in and it just shows that they respect us too. Kind of like a pat on the back," says Houldieson.

Ford employs a couple thousand long term temps and most work at assembly plants in Chicago and the Twin Cities.

Houldieson said she’ll buy some new clothes for her two boys, and maybe some expensive shoes to protect her feet during those long hours at the plant.

General Motors is jumping back into advertising during the Superbowl.  GM will likely spend $15,000,000  on ads focusing on its Chevrolet brand.

Many car companies like Ford Motor Company are using social media and Internet-based advertising more and more.  But analyst Ed Kim of AutoPacific says Superbowl ads still generate a lot more buzz.

"Any automaker advertising during the Superbowl is certainly going to have a whole lot of exposure to a whole lot of people all across America," says Kim.

Kim says GM's current marketing czar, Joel Ewanick, used to work for Hyundai, so he has experience using the Superbowl to improve a car company's image and sales.   At the peak of the recession, Hyundai began a highly successful campaign which allowed people to return Hyundai cars if they lost their jobs.  Kim says Hyundai used the campaign to good effect in its Superbowl ads.

GM did not advertise during the Superbowl last year and the year before.  The automaker does plan a social media campaign in conjunction with the Superbowl.  GM will release its Superbowl ads early to its Facebook fans.

Kim says that will generate some extra buzz for GM.

The ads will focus on the Chevrolet brand.   Chevy generates about 70% of GM's sales in the U.S.

General Motors is saying thanks but no thanks to more federal loans.  The Detroit automaker is withdrawing its application for more than 14-billion dollars in low-cost loans from the Department of Energy.   

Many car companies including Ford have received DOE loans, which are intended to help auto companies revamp factories to build more fuel-efficient cars and trucks.  GM applied for loans through the program shortly after emerging from bankruptcy.  But the automaker says its financial situation has improved since then. 

Gerry Meyers is a professor at the University of Michigan Ross School of Business. He's also a former Chairman of American Motors Corporation.  He says taking the loans would have given GM more debt.   And the automaker told prospective IPO investors late last year that it would avoid going deeply into debt.

It’s quite clear that they’re trying to clean up that balance sheet and also get the government out of the business, so it’s just another step in that direction and I think it’s wise.

Meyers says the next step to GM’s recovery is to stop the revolving door at the top executive level.  The company has had four CEOs in two years.   

The new GM has been turning a corner of late. It posted three profitable quarters last year:

• $865 million in the first quarter
• $1.6 billion in the second quarter
• $2.1 billion in the third quarter

(still waiting on fourth quarter numbers)

Now, in another sign of financial health, the auto company says it will no longer seek government loans to help it modernize factories:

From the Associated Press: