General Motors announced plans on Monday to cut 2,000 jobs at two US plants as it slashes production in the wake of a sharp drop in demand and amid a deepening recession.
The cuts come as the cash-strapped automaker prepares to submit a long-term viability plan in exchange for obtaining billions in loans from the US government.
GM's US sales fell 23 per cent in 2008 while total industry sales fell 18 per cent in the steepest annual decline in 29 years to levels not seen since 1992.
The largest US automaker slashed production by 21 per cent in the fourth quarter of 2008 and cut its first quarter production forecast by 53 per cent.
"Although we are bringing all our plants in North America back on line in the first quarter, many of those will have additional downtime in the first and second quarter," GM spokesman Susan Waun told AFP.
The job cuts will come through the elimination of a shift at an Ohio sport utility plant and a Michigan car factory, Waun said.
Nine of the automaker's 15 US plants and one plant in Canada will face weekly shutdowns but the breadth of the production cuts has not yet been determined, Waun said.
"This is all done to align our production with market demand and we're obviously monitoring it very closely these days."
The shifts will be eliminated in March and April.
GM had 62,000 hourly and 29,500 salaried workers at the end of 2008.
That is down dramatically from 105,000 hourly and 36,000 salaried workers in 2005, when GM began posting staggering losses which reached 72 billion dollars through the third quarter of last year.