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Originally Posted by paul8488
Not sure I understand business well enough. Wasn't the point of spinning-off Delphi to... I don't know... spin them off?!? How is it GM will be responsible for Delphi debt?
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Because the UAW made GM agree to this "safeguard" in the event that Delphi didn't make it. And let's face it, like Ford and Visteon, GM spun off all the shoddy, unprofitable business lines. Unlike Visteon, whose employees remained paid by Ford, GM saddled Delphi with uncompetitive labor costs to cover on its own. Further, all the people who had been GM employees for years were suddenly told to go it alone, and with these disadvantages. To do so, Delphi either needed to be less-shackled, or GM needed to attach a lifeboat to the Delphi ship when it set sail.