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How to save General Motors Corp.?

By Amarendra Bhushan for CEOWORLD Magazine Updated:December 1, 2008

1) Sell All of GMAC and the Insurance Business

2) Cut down from five regional offices to two. One in Atlanta (east of the Mississippi River)and one in LA (west of Mississippi River). That means Chicago, New York, and Dallas are closed. With about 250 people working in each location (750 total) at an average of $100,000 each, that is a yearly savings of $75 million. Operation cost (rent, equipment, etc.) at the three locations will save another $1.8 million. Benefits for the 750 employees will save another (at $20,000 each) another $15 million.

3) Next, there is an average of three offices per state (local offices in cities across the country), if we close them, that is another $3 million in office space.

4) Next, the District Managers work out of their house and the Zone Managers (or whatever term is given to them), could be let go. They make around $150,000 a year and there are about 75 of them. Again, a savings of $11.25 million. With benefits, a total of $12.75 million in savings.

5) Next, cut around 150 jobs at the Detroit GM Headquarters. A savings of around $18 million with benefits.

6) Next, cut Buick down to two cars (Enclave and Lucerne), cut Pontiac to one (G6), cut GMC to two (Yukon and Sierra), cut Saturn to one (Vue) – and put all cars to a new umbrella called “United GM”. This will save GM billions. Also cut back on two Chevy models and two Cadillac models.

7) Next, cut advertising in December, January, February, March, April, and May (with the exception of auto show advertising for a three week period during the show and its incentives). This will save GM around $1.4 billion.

Sell all five planes. This will save GM $100 million in sales and another $100 million in yearly travel expenses for a total savings of $200 million dollars.

9) GM needs to cut their total car models to 25 (from 60). What they could do is get rid of all Buicks expect Lucerne and Enclave; get rid of all Pontiacs except G6; get rid of all GMCs except Sierra and Yukon; get rid of all Saturns except the Vue; get rid of Saab all together; get rid of at least three Chevy models; get rid of at least two Cadillac models.

10) Get rid of half the dealerships. Chevy seems to have the best distribution so change the Chevy dealerships to Chevy, BPG, Saturn, and Cadillac

11) Close at least three of the five regional offices

12) Close all Zone offices and have employees work out of their homes

13) Get rid of 50% or more of white collar workers in the field

14) The factories will close based upon which models will be discontinued

15) Have upper management take a 35% pay cut

16) Have middle management take a 20% pay cut

17) Cut advertising from $2.3 billion per year to $750 million

18) Get rid of advertising groups and have national advertising only

19) Get rid of co-op advertising dollars

20) Get rid of all promotional advertising

21) Cut all regional and national meetings that cost more than $100,000

22) No parties for auto shows

23) Have special cash incentives for cash only purchases

24) Once the Volt battery is discovered, convert at least half the cars and trucks left after the cut to Hybrid

25) Move 1/2 the engineers to be used to discover more fuel efficient standards and more alternative fuel / hybrid cars

26) Sell all five planes and travel coach (a $100 million savings from cost of planes and a $100 million savings in yearly air cost for a total savings of $200 million).

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