Delphi Backs Away From Cuts

Bankrupt auto parts giant Delphi said Dec. 19 it was backing away from a massive wage cut proposal that had angered union members and prompted the threat of a strike.

Delphi reaffirmed its commitment to reaching a "consensual agreement" with its unions and GM on a comprehensive restructuring before asking the bankruptcy court to impose the cuts. The company said that in light of GM's recent offer of support and discussions with the United Auto Workers, the auto parts maker is withdrawing its November 15 proposal to its unions.

In its statement Dec. 19, Delphi said the company's "primary short-term focus is to reach consensual agreements enabling competitiveness for Delphi's core U.S. operations, by modifying current labor agreements and realigning Delphi's global product portfolio and manufacturing footprint to preserve the company's core business."

UAW president Ron Gettelfinger and vice president Richard Shoemaker, in a joint statement, welcomed the move by Delphi. "We have always believed that it is in everyone's interest for these matters to be settled by the parties through the collective bargaining process ... We hope the company's announcement results in a meaningful change in its position, but only time will tell if that is the case."

In order to further facilitate discussions, the Michigan-based company said it will defer the filing of motions in the bankruptcy court until at least February 17. Depending on the outcome of discussions, however, Delphi said it may be necessary to return to its November 15 proposal.

Copyright Agence France-Presse, 2005

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