Delphi Corp, General Motors and the United Auto Workers continue to make “significant progress” in talks aimed at heading off a potentially crippling labour dispute, but significant issues remain to be worked out, union members have told Dow Jones.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
The companies are trying to negotiate concessions from the union that would cut Delphi’s labour costs at Delphi. The parts supplier, which filed for bankruptcy last October, has said it will ask the bankruptcy court on 31 March to reject its union contracts if an agreement isn’t reached. The UAW has warned that could precipitate a strike, which could shut down operations at Delphi and, in turn, GM, the news agency noted.
Union members who attended the meeting said UAW vice president Richard Shoemaker said the union wants at least to reach agreement on an early retirement plan that would involve buyout packages for older hourly workers at GM and Delphi.
Previously, the parties had discussed offering buyouts to GM workers then allowing thousands of Delphi workers to flow into the vacant spots.
“They are getting closer on the incentives,” a union member told Dow Jones. “They want to do incentive packages in both companies, not just one.”
Shoemaker didn’t offer specifics about how many workers would be offered buyouts or how much they would be offered, the union member said.
Dow Jones noted that GM has about 105,000 UAW members, and 37,000 to 40,000 of them are eligible to retire now or in the near future, while Delphi has about 24,000 UAW workers.
UAW spokesman Paul Krell told the news agency that, while “progress is being made,” there are still a lot of hurdles to clear.
“Vice President Shoemaker said the three way talks are constructive, progress is being made, but many significant issues have yet to be resolved,” Krell reportedly said.
Dow Jones added that an agreement won’t come cheaply for GM, which has estimated its benefit obligation to Delphi employees and retirees who worked for the automaker before Delphi was spun off total US$3.6 billion to $12 billion.
Delphi chief executive Steve Miller has said the $65 an hour in wages and benefits the supplier pays its hourly workers is much higher than its competitors and isn’t sustainable.
Spokesman Lindsey Williams told Dow Jones Delphi remains hopeful the three sides can reach an out-of-court agreement.
“The talks have been constructive, they are progressing, but we do still have some gaps we need to close and we continue to talk,” he told the news agency.
He added that, even if Delphi files its motion on 31 March, it will take some time for a judge to rule, and the company plans to keep talking to GM and its unions throughout the process.
But Dow Jones said that another union representing Delphi workers, the IUE-CWA, has asked its Delphi union branches to hold strike authorisation votes and six have so far voted in favour of a strike if Delphi receives court approval to reject contracts.
The UAW has not conducted strike authorisation votes at Delphi yet, the report added.
