Oct. 24--General Motors Corp. told executives this week that it will begin involuntary salaried layoffs later this year as it works to adjust to a seizing global economy that one leading auto economist likened to an "economic 9/11" that requires a $15-billion industry bailout.

In an e-mail to U.S.-based GM executives, Chairman and Chief Executive Officer Rick Wagoner and President Fritz Henderson said the company now plans to reduce its salaried workforce by more than the 5,000 it targeted in a retirement incentive program that comes to a close this week.

The company also said it will cut several salaried benefits, including the elimination of its 401(k) match and tuition assistance.

The increased workforce reductions are expected to be just one part of additional cost-cutting that GM will introduce this year to conserve cash for operations, people familiar with planning told the Free Press.

The company is expected to outline additional cost-cutting measures when it announces its third-quarter earnings.

GM has not yet said when it will announce earnings.

"The global economic outlook remains very concerning," Wagoner and Henderson said in the e-mail. "Actions are being taken throughout GM's global operations to address our increasing need to conserve cash."

Salaried and contract worker job cuts are expected to begin later this year, according to the e-mail.

The prospect of further cuts comes even as GM is exploring a merger with Chrysler LLC and is working to sell assets for cash. GM is believed to be interested in Chrysler's supposed stockpile of cash, which some analysts and economists believe could be enough to sustain GM through 2011 to an improved economy.

Bailout needed

Absent a deal between GM and Chrysler, Sean McAlinden, chief economist at the Center for Automotive Research in Ann Arbor, told the Free Press that the U.S. auto industry needs a federal bailout to survive the global credit crunch.

"This is an unprecedented, 1933 situation," McAlinden said, alluding to the Great Depression.

He also likened the current situation to the crisis immediately following the 2001 terror attacks. "We're facing an economic 9/11 event," he said.

McAlinden said GM could run out of money within 12 months and that Ford Motor Co. may have enough for 12 months, but probably not enough for more than 18 months.

"We've never seen a situation so dire for all three companies at one time," McAlinden said.