Wednesday, September 26, 2007
GM And UAW Settle?
General Motors Corp. reached a tentative contract agreement with the United Auto Workers, ending a two-day strike and winning a retiree health-care fund that offloads about $50 billion in future obligations.UAW rep says that they did win job protections:
``We got the job security guarantees we were looking for,'' Gettelfinger said. These include a modified version of the ``jobs bank'' program that allows UAW members to receive paychecks even if there was no work for them to do, he said.Here's hoping that it really is a decent settlement.
Gettelfinger predicted that at the end of the four-year contract, the union's membership will be roughly the same as it is today, assuming the company can maintain its current sales volume. The union represented 73,454 active employees at GM when talks began in July.
Perhaps some of the problem is that GM really has a negative book value. Take just the additional commitments from the financing companies.... They've been selling off assets to cover losses.
I don't know about you but my wallet feels lighter.
"For the UAW, the proposed independent trusts represent both a risk and an opportunity. If Ford and GM strike similar deals, and all three funds are merged into one, the health-care fund could contain $60 billion to $70 billion. That would make it equal to the 20th-largest pension fund in the country, says Global Proxy Watch.
The UAW's biggest risk is that the fund's liability is likely to grow. A previous health-care trust negotiated by the UAW with industrial giant Caterpillar Inc. collapsed in 2005 after about seven years, in part because of runaway health-care costs. Caterpillar, its retirees and the UAW now are embroiled in litigation over who was at fault."