How the 2006 Special Attrition Package Reshaped General Motors

Katharine A. Frohardt-Lane, General Motors
Hallie J. Kintner, University of Michigan
Dana B. Kamerud, General Motors

In response to reduced sales and consequent declines in production volumes, domestic automakers have leveraged their demographic structure to reduce their workforces. Since 1999, when the workforce population was over 100,000, General Motors’ hourly population dropped to about 62,000 at the end of January 2009. Most of that decline occurred as the result of two successful Special Attrition Programs (SAPs). The 2006 SAP, far more successful than anticipated, saw 34,000 hourly employees leave the workforce in less than one year. This paper describes the innovative, corporate-wide 2006 Special Attrition Program, which included retirement incentives. How did the demographic composition of the workforce change? How did the company maintain production?