Shares of General Motors Company (NYSE:GM) slid Tuesday after roughly 5,000 white-collar employees took advantage of a buyout program designed to shrink the automaker’s workforce.
The program is expected to cost the company about $1 billion this quarter, according to chief financial officer Paul Jacobson. Long-term, the move is part of a plan to eliminate $2 billion in structural costs by the end of 2024.
The program’s success makes it likely the company won’t announce layoffs, Jacobson said. The affected employees are expected to leave GM by the end of June, according to a spokesman.
GM announced the $2 billion cost-cutting program in January, saying between 30% and 50% of the savings were expected during 2023.
The buyout was offered to most of the company’s 58,000 white-collar workers in the US. To qualify, employees needed to have been with the company for five years, or two years if in an executive role.
Shares of GM eased 1.5% Tuesday to $35.74.
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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