has become a financial albatross around General motor neck. General motor spends as much as $1,635 on every vehicle sold to cover benefits for active and retired U.S. workers. In addition, with all compensation perks factored in, pay for General motor workers adds up to $73 per hour. Toyota pays nothing for retirees and only $215 per vehicle to cover active-worker benefits. Management addressed the imbalance in 2006 by offering 126,000 employees as much as $140,000 to sever all ties with the company. The massive buyout was part of a four-point restructuring plan announced in 2005 to achieve $7 billion in cost reductions.
Yet of all the tricks General motor has up its sleeve to man-age its financial crisis, one option is reportedly off the table. In a written statement to the press, Management acknowledged “unprecedented challenges” related to global financial markets. The statement firmly added, “But bankruptcy protection is not an option General motor is considering. Bankruptcy would not be in the interests of our employees, stockholders, suppliers, or customers.”