In a news conference on Tuesday, July 15, General Motors announced a 20 percent cut in salaried employment costs, the sale of assets worth $4 billion, and a loan of $2 billion in an effort to shore up the company's liquidity through 2009 by $15 billion.

Additionally, the common stock dividend will be suspended while the company restructures in responses to the continued high cost of fuel and the market's steady shift away from trucks and SUVs in favor of small, fuel efficient sedans and hybrids.

Current auto sales in the United States across the industry are at their lowest point in a decade, prompting GM's dramatic moves. Consequently, it will be 2010 before the company will makes its first scheduled payment into the agreed upon health care benefit trust fund for retirees, part of a negotiated contract package with the UAW in 2007.

By eliminating white collar jobs, some health care coverage for retirees, executive bonuses, and bringing capital spending down, GM is looking to generate a cash savings of $10 billion through 2009.

In the wake of the announcement, shares in GM rose 2.8 percent to $9.65, a signal that investors clamoring for the largest of the U.S. carmakers to cut costs and generate capital were reacting favorably.

Analysts do not predict any substantial recovery in auto sales in the U.S. in 2009, leaving automakers to scramble to get fuel efficient products on the market and to manage their growing back inventory of gas guzzlers.