UAW members approve General Motors concessions

[mgescuro]

UAW members approve General Motors concessions

The United Auto Workers union has ratified a package of concessions designed to reduce General Motors Corp.'s labor costs.

UAW President Ron Gettelfinger said at a news conference Friday that 74 percent of GM's 54,000 U.S. production and skilled-trade workers voted in favor of the deal.

The vote comes before an expected Chapter 11 bankruptcy protection filing by GM on Monday. Bankruptcy experts say having the labor agreement in place will help move the process through court more quickly.

The UAW says the cuts will save GM $1.2 billion to $1.3 billion a year.

"We very much appreciate the support of our employees and retirees," Diana Tremblay, GM vice president for labor relations, said in a statement. "Their shared sacrifices will enable GM to become a stronger, more viable company that will continue to deliver world-class cars and trucks."

UAW leaders agreed to the revised contract last week that freezes wages, ends bonuses, eliminates noncompetitive work rules and ends the possibility of a strike until the next contract expires in 2015.

It also gives a union-run retiree health care trust 17.5 percent ownership of a post-bankruptcy protection GM, with a warrant to buy another 2.5 percent. The trust will take on the company's retiree health care costs starting next year. The stock will come in exchange for part of the company's $20 billion obligation to the trust.

GM has received $19.4 billion in loans from the U.S. government, which would get 72.5 percent ownership of the new company, perhaps sharing with the Canadian government. The remaining 10 percent would go to GM bondholders to wipe out $27 billion in unsecured debt.

Bondholders have until 5 p.m. EDT Saturday to accept or reject the stock-for-debt offer, under which they would get a warrant for an additional 15 percent of the new GM's stock.

Existing GM shareholders would be left with little or nothing, and GM shares fell 32 cents, or 29 percent, to 80 cents in afternoon trading. They fell as low as 75 cents earlier Friday, their lowest level since the Great Depression.


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[chevyman1973]

good the union needs to be on board with this if this is going to work!

[rsbaker]

Originally Posted by chevyman1973

good the union needs to be on board with this if this is going to work!

Agreed! I think everyone at GM has seen the writing on the wall with the notable exception of a few bond holders and they still have 2 days to do a deal or get nothing.

[ScottS]

Nothing like waiting until the last minute to recognize you're part of the problem.

[RamJet502]

Originally Posted by ScottS

Nothing like waiting until the last minute to recognize you're part of the problem.

The only thing they recognized was GM's willingness to import Chinese manufactured vehicles, that was a wake-up call.

[mgescuro]

Originally Posted by ScottS

Nothing like waiting until the last minute to recognize you're part of the problem.

They realized they were part of the problem?

[fp115]

Originally Posted by mgescuro

They realized they were part of the problem?

And you are going to argue that they are not? Explain exactly how it was cost effective to build a small car in the US versus Toyota or Honda.

[goochman]

Originally Posted by fp115

And you are going to argue that they are not? Explain exactly how it was cost effective to build a small car in the US versus Toyota or Honda.

mgescuro's point was that they didnt realize they were part of the problem

[chevyman1973]

if restructure means that they can make cars here in the us and make a profit on them then they are well on there way to being a great company again

[Igotherealscoop]

The U.A.W. workers have been giving back and making rash sacrifices on work rules since 2005. They ammended the 2003 contract in 2005, which laid the ground work for the v.e.b.a. that came in 2007. The workers also defered $1.25 raise in 2005 towards the veba. The anchor around gm's neck as far as labor costs go is that they have over 300,000 retirees compared to less then 65,000 hourly workers. That is almost a 5 to 1 ratio for those that struggle with math. In the 2007 negotiations the uaw agreed to take over health care for retirees starting jan. 1 2010 with the veba and gm making a set number of lump sum payments. That would have eliminated roughly 80% of the health car liabilitys that gm had greatly reducing the hourly costs the company is saddled with. My hat goes off to the UAW worker who hs ben vilified in the media and these anti union senators from the south.

[ScottieDogFLA]

It will NOT work. Re-constituted GM is toast.

[FierySolstice]

What are the point of these unions anymore? I thought unions were organized years ago because companies rarely offered vacations, healthcare, raises etc? With the government regulations these days, unions should be obsolete. I believe they are just organizations that take your money and don't really do anything for you. They are basically a joke and they are part of the problem for the state the American car companies are in right now.

[D C]

Originally Posted by Igotherealscoop

The U.A.W. workers have been giving back and making rash sacrifices on work rules since 2005. They ammended the 2003 contract in 2005, which laid the ground work for the v.e.b.a. that came in 2007. The workers also defered $1.25 raise in 2005 towards the veba. The anchor around gm's neck as far as labor costs go is that they have over 300,000 retirees compared to less then 65,000 hourly workers. That is almost a 5 to 1 ratio for those that struggle with math. In the 2007 negotiations the uaw agreed to take over health care for retirees starting jan. 1 2010 with the veba and gm making a set number of lump sum payments. That would have eliminated roughly 80% of the health car liabilitys that gm had greatly reducing the hourly costs the company is saddled with. My hat goes off to the UAW worker who hs ben vilified in the media and these anti union senators from the south.

Would have. But that VEBA still required $20 Billion to fund. Or they could have gone the route that nearly every other company has gone and NOT provided retirement health care at all. That would have dropped that VEBA obligation to damn near zero. I'm not seeing why the union-represented workers should be getting anything different than salaried workers when it comes to retirement healthcare.

[DRTY]

Originally Posted by chevyman1973

good the union needs to be on board with this if this is going to work!

Yeah... you wouldn't want to be rid of the cancer that caused this whole mess.

[ghughes]

I dont see anything about creating wage parity with the southern transplants- sorry, $1.3 billion and foregoing a 1.5 % raise is not going to cut it!!