More GM workers laid off as government deadlines loom

DETROIT - General Motors Corp. began firing 1,600 white-collar workers Monday and Fiat's CEO left Italy to resume critical talks on an alliance with Chrysler LLC, as deadlines draw closer for GM and Chrysler to finish their restructuring plans.

Both automakers are living on a combined $17.4 billion in government loans and have said they'll need more money to survive. Chrysler must cut its debt and its labor costs and forge an alliance with Fiat Group SpA by April 30, or President Barack Obama said Chrysler won't get any more help.

If GM can swap much of its debt for stock and get concessions from the UAW and Canadian Auto Workers by June 1, the government said it will provide more loans to keep the company going. Bankruptcy financing also is possible if the company determines Chapter 11 is its best bet to achieve the cuts it needs.

GM's layoffs this week bring the automaker close to its goal announced in February to cut 3,400 U.S. salaried positions, spokesman Tom Wilkinson said. GM has about 29,000 salaried workers in the U.S.

'In these unprecedented times, GM is reinventing every aspect of our business, including our organizational size and structure, to create a lean and agile company,' GM North America President Troy Clarke said Monday in an e-mail to employees obtained by The Associated Press.

GM has said it will eliminate 47,000 jobs worldwide by the end of 2009, but the cuts may go even deeper as the company moves toward its deadline. CEO Fritz Henderson has said the automaker will close more factories beyond five announced in February. The factories to be closed have not yet been identified.

'There is no question, as we look at our revised plan to go deeper and go faster in our operational restructuring, there will be further reductions in manpower, people, that are going to affect communities, affect plants and people, both on hourly and the salaried side of the business,' Henderson told reporters Friday.

For GM to qualify for more government aid, the UAW must agree to take stock for part of the roughly $20 billion that GM owes to a union-run trust that will cover retiree health care costs starting next year. The UAW and CAW also must agree to cut labor costs.