General Motors has moved more swiftly than had been expected to mount a sweeping reduction in jobs and costs after suffering sharp drops in sales in the United States.

The world's biggest carmaker wants to reduce its salaried staff costs by 20 per cent. Several thousand managerial and administrative jobs will go, although GM will not give a precise figure.

If all the cost reductions came via job cuts, 6,400 positions would go, with the axe falling largely on the North American operations. GM plans to save $1.5 billion (£752 million) from reducing its salaried staff costs.

The British Vauxhall plant at Ellesmere Port on Merseyside is unlikely to be affected.

The carmaker is also halting its dividend payments in a move that will save $800 million throughout 2009.

GM had been expected to announce a restructuring programme after a board meeting next month. Last month sales in the United States fell by 18 per cent, although they held up better than those of Ford, GM's main rival, which suffered a slump of 28 per cent.

GM said that it expected to sustain a significant loss in the second quarter after the American market had been hit by the economic downturn and by the soaring price of fuel.

Rick Wagoner, the chairman, said: “We are responding aggressively to the challenges of today's US auto market. We will continue to take the steps necessary to align our business structure with the lower vehicle sales volumes and shifts in sales mix.”

He added that the cost cuts ensured that GM was covered in terms of its cash needs for the whole of next year, even given the worst scenario in the car market.

The job cuts that emerged yesterday come after a series of reductions that have shrunk the white-collar workforce by 12,000 to 32,000 since 2000. Ford has cut 2,000 white-collar jobs in North America.

As part of its restructuring, GM also wants to sell up to $4 billion of assets and raise up to $3 billion in extra capital to bolster its cashflow.

GM, which has faced investor concerns over its financial strength, said that it had liquidity of $23.9 billion at the end of its first quarter, which, it said, was adequate for this year's needs.

It said that it wanted extra as a cushion against “rapidly changing market conditions” and a long economic downturn in the US. Through the job and cost cuts, it is trying to boost its cashflow for next year by $15 billion.

The future of Hummer, GM's heavy sports utility vehicle brand based on military designs, is being reviewed. It is likely to be the first division to be put up for sale as American motorists turn to more fuel-efficient cars.

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