CHICAGO (Reuters) - General Motors Corp and popular professional golfer Tiger Woods said on Monday that they would end their endorsement deal at the end of the year.
GM, which has warned it will soon run short of cash and is asking the U.S. government for financial support amid the economic slowdown, and Woods, who is recovering from reconstructive knee surgery, called the arrangement "mutual and amicable."
They cited a desire by the golfer for more personal time with a second baby due in late winter, as well as a need for GM to cut costs as it struggles with declining demand in the U.S. market.
"In light of the news coming out of Washington, this decision is the result of discussions that started earlier in the year, and the timing of this agreement with these other activities is purely coincidental," said Mark LaNeve, GM's North American vice president of sales, in a statement.
The Detroit automaker, which spends heavily in golf, has been slashing marketing costs across all venues, previously disclosing reduced spending on motorsports, as well as eliminating television ads next year during such events as the Oscars and Emmy award shows and the National Football League's Super Bowl championship game.
Terms of the arrangement were not disclosed although GM spokesman Pete Ternes said it ends the automaker's five-year deal with Woods a year early. Woods will continue to drive Buick vehicles through 2009.
For the past nine years, Woods has endorsed GM products around the world and been heavily associated with the Buick brand in the U.S., Canadian and Chinese markets.
Woods, 32, ended his year in June for the knee surgery after winning four of six tournaments in which he played.
The golfer, whom BusinessWeek magazine in October ranked the most powerful person in the sports industry, has said he intends to return to the tour some time in 2009, but will not be at full strength until 2010.
GM has deals through 2010 as the title sponsor of two PGA Tour events: the Buick Invitational in La Jolla, California, and the Buick Open in Grand Blanc, Michigan.
Buick has been involved with golf since 1950, when it became one of the PGA Tour's initial sponsors, and it is still the tour's official car through 2010.
GM's overall vehicle sales were off 20.4 percent through October, while Buick brand sales were down 23.6 percent.
GM also is in talks with the PGA of America about its sponsorship contract, Ternes said.
Last week, Larry Peck, Buick and Pontiac's promotions manager, told Reuters that everything at the automaker was fair game for cuts in spending. He added GM already has canceled such back-of-the-house spending as dealer contests and hospitality at its golf events.
GM cut its golf ad spending by almost 54 percent to $10.8 million in the first six months of 2008, according to TNS Media Intelligence. Its spending on sponsorships, mostly focused on sports, also is likely to be down from last year's $235 million to $240 million range, IEG Sponsorship Report said.
Editing by Matthew Lewis and Brian Moss