GM has announced that it will invest $2 billion in two years from now, creating or retaining 4,000 jobs.
We are doing this because we are confident about demand for our vehicles and the economy, GM Chairman and CEO Dan Akerson said at an event at the Toledo Transmission Plant on Tuesday. This new investment is on top of $3.4 billion and more than 9,000 jobs that GM has added or saved since mid-2009.
But industry watchers are not happy at the figure as 1,357 workers on its layoff list will be brought back while 400 jobs will go to its new Toledo transmission plant and another 250 jobs to the Bowling Green Corvette plant.
The number shrinks to 2,000 and spreading it across GM's 15 other facilities nationwide, 133 new jobs will be created in each location. Though the numbers are too small to compare with hundreds of layoffs announced by the auto industry since 2007, GM has finally shown the signs of recovery.
The company, last week, reported its fifth-consecutive profitable quarter since emerging from bankruptcy in July 2009. It posted a net income of $3.2 billion, or $1.77 per share. Revenue increased $4.7 billion to $36.2 billion, compared with the first quarter of 2010.
The United Auto Works' goal has been to return all laid-off workers to active status and see the company begin hiring again, said Joe Ashton, UAW vice president – GM Department. These announcements will create and retain thousands of jobs and bring General Motors back to full employment of our hourly workforce.
Dan Akerson, chairman and CEO, was upbeat when he said, GM has delivered five consecutive profitable quarters, thanks to strong customer demand for our new fuel-efficient vehicles and a competitive cost structure that allows us to leverage our strong brands around the world and focus on driving profitable automotive growth.
Echoing similar sentiment, Ashton said, If the market continues to recover, we are confident that GM will hire new workers to meet the strong demand for the products our UAW members build.
According to the nonprofit Center for Automotive Research, the ripple effect of the planned investments would add $2.9 billion to the U.S. Gross Domestic Product and create or retain more than 28,000 jobs.
In China alone, GM sold 686,000 vehicles in the quarter, while its subsidiary GM South America sold 250,000 units in the same period, though its market share in the region dropped to 18.8% from 19.6% in the fourth quarter.
GM, second to Toyota in global sales, could benefit this year as the Japanese automaker has lost its production or closed down some plants following the March 11 earthquake in Japan.