NEW YORK (CNNMoney.com) - GM plans to lay off 500 contract workers at its Warren, Mich. technical center on Friday, according to a report published Thursday.

The job cuts will effect mostly engineers and designers and are part of the automaker's efforts to slash costs at its North American operations, the Detroit News said.

"This is a very challenging time, and these are very difficult decisions for the company," GM spokesman Robert Herta told the newspaper. "It's all about aligning the work force with our business needs."

The company said the cuts are part of a previously announced plan to reduce its U.S. white collar work force by seven percent in 2006, the report said.

GM (Research) has been plagued by declining sales and market share and a downgrade in its bonds to junk status.

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