Shares of GM stock rise after report of 12,400 union employee buyouts

LOS ANGELES TIMES
General Motors Corp.'s stock rose 8 percent Wednesday after a Merrill Lynch analyst issued a strong "buy" recommendation, citing a comment from United Auto Workers officials that 12,400 union workers had accepted buyouts from the beleaguered automaker.
Investors were so pleased with the news, following the report by Merrill Lynch auto industry analyst John Murphy, that GM's shares gained $2.03 in heavy trading to close at $26.51.
In March, GM announced it would offer buyouts and early retirement incentives worth as much as $114,000 to its 113,000 union workers in a bid to trim its payroll and future pension and health-care costs.
The automaker is struggling to recover from a $10.6 billion loss last year and to stop a three-decade decline in its share of the U.S. passenger vehicle market.
According to the Merrill Lynch report, UAW officials have said that 12,400 union members who work for GM had accepted the buyouts as of May 3. GM would not comment Wednesday.
But a knowledgeable GM insider, speaking on condition of anonymity, said nearly 15,000 workers have accepted the buyout package. Workers have until June 23 to accept the buyout and early retirement offers.
GM did acknowledge Wednesday that it has begun hiring temporary employees in anticipation of labor shortages this summer as workers who accepted the buyouts begin leaving. "Very few people have left so far, though," said GM spokesman Dan Flores.