Gm Exec Says 'Solution' Will Be Reached with Delphi; Judge Postponed Hearings Until Sept. 18

Gm Exec Says ‘Solution’ Will Be Reached with Delphi; Judge Postponed Hearings Until Sept. 18

General Motors Corp. Chief Financial Officer Fritz Henderson said the automaker, supplier Delphi Corp. and the United Auto Workers will reach an "equitable solution" in talks over proposed labor concessions at Delphi. "Resolution of Delphi remains my top priority," he said Thursday at a Credit Suisse automotive conference in New York. "I am absolutely convinced we will find an equitable solution."

From Buffalo News

"Resolution of Delphi remains my top priority," he said Thursday at a Credit Suisse automotive conference in New York. "I am absolutely convinced we will find an equitable solution."

GM is in talks with Delphi, its bankrupt former parts unit, and the union to try and avoid a strike at the supplier that could shut down the automaker’s operations. Delphi has asked a bankruptcy judge to let it scrap labor agreements and impose terms including wage reductions of as much as 55 percent. The UAW has threatened a walkout if Delphi implements cuts.

The automaker hopes to "significantly reduce" the Delphi work force to avoid a strike, Henderson said. GM is helping to pay for buyouts and retirement incentives at Delphi, its largest supplier. Troy, MI-based Delphi filed for bankruptcy protection for its U.S. operations in October.

GM CEO Rick Wagoner said Wednesday that the talks with Delphi and the UAW are "complex and taking some time." Wagoner also said he was "optimistic we’ll come to a reasonable conclusion." He had said in June that he wanted an accord by the U.S. Labor Day holiday, which was Sept. 4.

U.S. Bankruptcy Judge Robert Drain last month granted Delphi’s request to postpone hearings on the contract negotiations until Sept. 18 to give the parties more time to reach an agreement outside of court.

GM has said that it may have to spend $5.5 billion to $12 billion to help settle the Delphi labor issue and that it expects the amount to be closer to the lower end of that range. GM under the 1999 spin-off of Delphi agreed to cover retiree and health-care benefits for former GM workers at Delphi if the parts supplier couldn’t.