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8 Facts About General Motor’s S’pore Retrenchment You Should Know

2017-05-24 , 4:39 pm

Just yesterday, it was reported on Straits Times that General Motors (GM), the American carmaker is planning to slash its operations here in Singapore by 70%

And with that announcement, an estimated 130 people’s lives just came crashing down.

Here’s everything you need to know about the retrenchment initiated by GM.

1. This wasn’t the first time it happened

This restructuring is not the first time General Motors’ decisions had affected Singaporeans greatly.

They relocated to Shanghai back in 2004 and only opened a regional HQ here in Singapore less than three years ago.

During the 2008 financial crisis, General Motors closed their distribution and logistic centre in Singapore. The centre had been operating in Singapore since 1972.

That affected over 100 jobs back then.

2. Employees Were Only Informed about This Two Weeks Ago

Staff at General Motors were only informed about the restructuring about two weeks ago. About 130 staff will be affected by the retrenchment.

They will be leaving in two batches, either at the end of the year in December or by the end of next month.

3. Severance Pay

GM will be paying retrenched employees one month of salary for each year of service plus an extra payment of another month as severance pay.

4. Even Higher Management Isn’t Spared the Restructuring

The restructuring of GM Singapore is merciless and affects employees across the entire organisation.

This includes the director of sales and business development Cheong Chee Sing who has been with the company for 22 years.

When approached for his comment by Straits Times, he said that the news “is timely” as he has been thinking about “taking a break” for some time.

Stefan Jacoby, president of Singapore GM, was another person affected by the restructuring but he could not be reached for comments.

5. The aim of the restructuring is to save money

GM said that this was a bid to save US$100 million (S$139 million) a year globally; and that the carmaker is running international markets “with an enterprise approach and making decisions that are best for the global business”.

Basically, if they’re making losses here, they’ll (and they did) cut it loose.

6. We’re not alone

Other than Singapore, it was reported on Euro News that GM is pulling out of India and South Africa as well.

It will stop selling cars in India, South Africa and East Africa. The company also cancelled a $1 billion investment planned for India. Ouch. In South Africa, it will sell its operations to Isuzu Motors.

This was after GM withdrew from Europe after the proposed sale of loss-making Opel-Vauxhall to French rival PSA Peugeot Citroen.

7. Estimated Cost of Restructuring

The cost of restructuring is expected to cost the company about US$500 million in the second quarter of this year.

Of which, around US$200 million will be cash expenses. GM had stated that they plan to cut more than 3,000 jobs last year.

8. To focus on profits, to be more disciplined

GM plans to focus all its cash and engineering capabilities on profitable areas like China and Latin America where autonomous vehicles will eventually be a possibility.

What are we spending our time doing? Are we spending time pursuing opportunities … or all of our time fixing problems? – GM President Dan Ammann

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Feature Image: straitstimes.com

This article was first published on goodyfeed.com