GM SA revises output schedule as economy deteriorates

General Motors
General Motors

Johannesburg - General Motors has adjusted output levels at its South African assembly operations and is considering options including voluntary job cuts as the automaker prepares for a further drop in local sales.

"Due to the deterioration in the economic environment and the anticipated resultant decline in vehicle sales, we have revised our production schedule," spokesperson Denise van Huyssteen said in an e-mailed response to questions.

"We are currently considering all alternatives, including voluntary separations, to minimize the impact of these changed circumstances on our business and on our employees."

South Africa’s economy is expected to expand at the slowest pace this year since a 2009 recession, according to government and central bank estimates, and business confidence in the continent’s most industrialized economy fell to the lowest in almost 23 years last month.

Domestic new-vehicle sales declined in 2015 for the second consecutive year and are expected to fall further in 2016, according to the National Association of Automobile Manufacturers of South Africa.

General Motors assembles the Chevrolet Spark, Chevrolet Utility and Isuzu pickups as well as Isuzu trucks at its Port Elizabeth operations in the Eastern Cape Province, according to the company’s website.

The automaker is engaging with unions, Van Huyssteen said. She declined to provide details of the production changes.

The local units of automakers including Ford Motor Company and Volkswagen start wage negotiations with South African workers this week, hoping to avoid a repeat of crippling, weeks-long strikes that have paralyzed the industry in the past.

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