The chief executive of General Motors admitted yesterday the company was failing to deal with its healthcare crisis as the car maker said its North American operations had lost almost $1.2 billion (£700 million) in the past three months.
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“We are not yet making the progress we need on the cost side of the business,” Rick Wagoner said, according to the Daily Telegraph, referring to the company’s crippling healthcare and pension costs.
“It’s clear we need to move faster in implementing the cost reduction strategies I outlined at our recent annual meeting. Our healthcare cost situation remains an extreme burden on our ability to compete.”
The company reportedly unveiled plans to axe around 25,000 jobs to save $2.5 billion a year and said it was talking to its unions about the generous contracts workers enjoy. However, Wagoner has said he was not sure if the two sides would ever be reconciled, the Daily Telegraph noted.
