From Associated Press
WASHINGTON — Visteon Corp. has agreed to shore up one of its pension plans under an agreement announced Monday with the federal pension protection agency.
The Pension Benefit Guaranty Corp. said that Visteon will accelerate a $10.5 million contribution to the plan, provide a $15 million letter of credit and guarantee up to $30 million of the pension obligations of some of its affiliates.
The move will bolster a pension plan that covers more than 5,300 former Visteon employees who worked at, or retired from, two plants in Indiana that were closed down in the past year.
Visteon has been hammered by the sharp drop in auto sales. The Van Buren Township, Mich.-based company has cut 2,800 jobs in recent months and last week said it would shift 2,000 additional workers in Michigan to a four-day work week and cut their pay.
Visteon, which was spun off by Ford Motor Co. in 2000, has about 35,000 employees.
Jim Fisher, a company spokesman, said the separate pension plan for the two plants dates from when Visteon was part of Ford.
The PBGC hasn’t taken over the pension plan, as it does with many bankrupt companies. But the agency can step in and seek additional financing for a plan when a company lays off 20 percent or more of the employees covered by it.
"We commend Visteon’s willingness to work with us to achieve an outcome that is favorable to its employees and retirees," PBGC Director Charles Millard said in a statement.
