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Merrill Lynch

analyst John Casesa cut his 2000 and 2001 earnings estimates for

General Motors

(GM) - Get General Motors Company Report

, a day after the automotive titan disclosed plans to cut jobs and phase out its



In a research note, Casesa said he now expects earnings of $8.53 a share in 2000, compared with $8.52 a share in 1999. He also said he was slashing his 2001 earnings estimate to $5.05 a share from $8.25. According to

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First Call/Thomson Financial

, analysts expect the company to earn $9.02 a share for 2000 and $6.93 for 2001.

Casesa maintained his near-term neutral and long-term accumulate ratings on GM, which yesterday announced plans to phase out the Oldsmobile unit and cut 10% of its work force. The automaker also lowered its fourth-quarter earnings forecast, and now expects to earn $1.10 to $1.20 a share. Merrill Lynch had expected the company to earn $1.75 a share for the quarter, according to Casesa's report.

GM said today it is on track to cut costs by $3.5 billion this year. In his note, Casesa said he was "surprised" that GM "does not plan to reduce permanently assembly capacity in North America to reflect the Olds phase-out," given that the company "has about 34% of the region's production capacity but about 28% of demand."

Casesa also said he believes the "costs of these actions are much more visible than their ongoing benefits right now."

Shares of GM were lately up $1.44, or 2.8%, to $53.19 in composite trading on the

New York Stock Exchange