Company News: GM may accelerate cost cuts

General Motors Corp. North America President Troy Clarke said Tuesday he will work toward achieving aggressive cost-cut targets as soon as possible as the company scrambles to revive its North American automotive unit and “adapt to a global, very tough, very competitive” marketplace.

Clarke, speaking during a question-and-answer session that followed a speech given to the Automotive Press Association, said the company currently has a target to reduce structural costs to 25 percent of revenue by 2010, but he insists he is working to meet that goal as soon as possible.

He said the costs currently represent nearly 30 percent of revenue. He said there are still “pockets” at GM where workers operate under “the legacy of having been big.”

He noted that GM once held 50 percent of the U.S. market but now holds less than 25 percent, and Clarke insists the company must continue to “break up” bureaucracy to cope with reality.

Clarke heads GM’s North American auto operations, which has been a money loser and a key contributor to the company’s financial woes. He took the helm of the troubled unit four months ago, taking the role from GM Chief Executive Rick Wagoner, who had been running the unit for more than a year.

GM’s troubles in North America primarily stem from high labor costs, excessive manufacturing capacity and falling market share.

“Alcoa Inc. plans to cut 6,700 jobs worldwide over the next year as part of a plan to help boost profits, the aluminum maker said Tuesday.

The company also said it will form a joint venture with the Sapa Group of Norway’s Orkla ASA that would combine its soft alloy extrusion business with Sapa’s Profiles extruded aluminum business.

Alcoa’s soft alloy extrusion business has about 6,400 employees in 22 plants in eight countries. Three of those plants — in Warren, Ohio; Tifton, Ga.; and Plant City, Fla. — won’t be in the new joint venture and will instead be sold, Alcoa said.

Alcoa has 129,000 employees in 44 countries.

“Winn-Dixie Stores Inc. emerged from bankruptcy Tuesday, 21 months after the grocery chain filed for Chapter 11 protection due to huge financial losses caused by competitive pressures.

The new Winn-Dixie is much smaller than the troubled company that filed for bankruptcy on Feb. 20, 2005.

It has 522 stores in five states and employs about 55,000 people, down from 920 and 79,000, respectively.