KEY POINTS:
The global credit crunch has claimed another scalp - the nation's oldest car financier General Motors Acceptance Corporation (GMAC).
The company has confirmed it is axing 185 jobs on both sides of the Tasman, 25 of them in New Zealand, the ABC reported.
GMAC began operating in Australia 90 years ago as a wholly owned subsidiary of US car giant General Motors.
But as the global financial meltdown worsened, fewer people have bought cars, and so far this year, GMAC has reported net losses of more than A$3 billion ($3.41 billion), forcing it to assess non-core operations.
GMAC's national customer service headquarters in Newcastle has fallen into that category, with a company spokeswoman telling the ABC 80 jobs are set to be axed there on New Year's Eve.
GMAC said a further 80 jobs will be shelved at its other Australian locations in addition to the 25 New Zealand workers being made redundant.
The company said the global credit crunch was solely to blame.
In the United States, GMAC has told some General Motors Corp dealers they will have to begin paying off older inventory, a step a major dealer group is protesting as an unfair tightening of credit that could prompt dealer bankruptcies.
"Unless immediately stopped, GMAC's actions will directly lead to the insolvency of a number of our dealer members," California New Car Dealers Association President Peter Welch said in a letter of protest to GMAC released on Tuesday.
"At a time of their greatest need, our GM dealer members feel completely abandoned by GMAC's rogue actions," he said.
GMAC, which is 51-per cent owned by Cerberus Capital Management, has limited financing for dealerships and for consumer purchases of new GM cars and trucks in recent weeks because of its own difficulty securing credit.
Then GMAC last week, moved to limit car loans to borrowers, raised the fee it charges for new loans and demanded higher down-payments from buyers, Mr Welch told Reuters other auto finance companies, including those owned by Ford Motor Co and Toyota Motor Corp.
Mr Welch said the decision to curtail inventory financing had hit dealerships hard.
Many GM dealers in California had been told that they would have to begin paying down the principal they owed on GM vehicles over 180 days old, with principal payments of 5 per cent to 10 per cent per month, he said.
Analysts have said the steps by GMAC threaten to compound sales difficulties for GM, which has seen its US sales fall by 18 per cent through September.
GM sold a controlling stake in GMAC in the USA to Cerberus in 2006 for $7.4 billion. It retains the remaining 49 per cent. GMAC financed over 40 per cent of GM's US sales in the past quarter.
- NZPA
