GM Raises Estimated Plant-Closing Charge

General Motors Corp. said Friday it raised the estimated after-tax charges it will take against earnings in the fourth quarter of 1997 on plant closings and asset impairments to $3 billion to $4 billion from $2 billion to $3 billion.

In a filing with the Securities and Exchange Commission, the world’s largest auto maker said the charges would equal $4.27 to $5.69 per common GM share, up from an earlier estimate of $2.85 to $4.27 per common GM share.

The Detroit-based company said the charges resulted from competitive studies that “are substantially complete.”

“GM will continue to study its efficiency and cost-effectiveness and, as necessary, will initiate further competitiveness studies,” the company said in the filing.

GM, which first announced lower estimates for the fourth-quarter charges on Nov. 11, could not immediately be reached for further comment. The increased estimate of the charges was made in a one-paragraph SEC filing.

In November, GM said it was reviewing all its businesses as auto makers around the world--pressed by over-capacity and pricing pressures--slash costs in search of efficiencies.

If taken as estimated, analysts said the charges could exceed some of the massive write-offs GM took in the early 1990s to pay for closing 23 plants.

Analysts noted that the fourth-quarter charges would probably be offset by $3.9 billion to $4.5 billion in other income the auto maker expects to book on the recent sale of its Hughes defense unit to Raytheon Co.

The only plant actions GM has discussed include the lighting, coil-spring and seating businesses that its Delphi Automotive unit wants to sell; and the restructuring of its Adam Opel unit in Belgium that will cut 1,900 jobs.

GM is targeting reducing its U.S. hourly work force by 30,000 to 35,000 jobs over three years.