GM seals union deal to speed worker retirement
Auto giant to pay for retirement incentives to 113,000 factory workers
MSNBC, March 22nd, 2006
General Motors Corp. and auto parts supplier Delphi Corp. announced deals with
the United Auto Workers on Wednesday that would help the struggling companies
cut labor costs by offering early-retirement buyouts to 113,000 U.S. hourly
workers.
The deal comes at a critical time
for GM, which increased by $2 billion its reported 2005 loss to $10.6 billion
last week. The world’s largest automaker has been losing U.S. market share but
is saddled with labor agreements that make it difficult to close plants or cut
workers. The plan also is crucial for Delphi, the largest U.S. auto parts
supplier, which is reorganizing in bankruptcy court after filing for Chapter 11
protection in October.
About 100,000 GM workers will be
eligible for payouts of between $35,000 and $140,000 depending on their years of
service. At Delphi, up to 5,000 workers will be eligible to return to GM,
Delphi’s former parent company, while 13,000 U.S. hourly workers will be
eligible for a lump sum payment of up to $35,000 to retire. Delphi has about
34,000 U.S. hourly workers overall.
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