Anderson's Delphi plant to close

A Delphi Corp. executive met with United Auto Workers Local 662 Friday and said the Anderson plant would be shutting down, according to Rick Zachary, president of Local 662.

“It isn’t anything we didn’t expect,” said Zachary.

The Associated Press ran a list of Delphi plants that would be closed or sold and Anderson Delphi was on it. The Kokomo plants were not.

Any decision Delphi makes is subject to proceedings in U.S. Bankruptcy Court, and Zachary said a hearing is scheduled for May 9-10.

“It’s not a good feeling,” said Zachary, and added it’s probably a good idea for workers to go back to General Motors Corp. if they can or retire.

“When Delphi gets through, there will only be four plants in the U.S. open,” said Zachary.

A call was placed by The Herald Bulletin to Delphi headquarters in Troy, Mich., for Brad Jackson but not returned. The spokesman in Anderson Friday, according to Zachary, was Roy Pouge. He couldn’t be reached for comment.

In a statement, Anderson Mayor Kevin Smith said, “While the city of Anderson values greatly the contribution Delphi makes to the community of Anderson, the city no longer depends on any single employer or market segment.”

Upon hearing the news, Gov. Mitch Daniels issued the following statement: “Our first thoughts are for our fellow Hoosiers in Anderson. We obviously will have work to do there. Anderson’s leadership is aggressive and creative, and our Indiana Economic Development Corp. has already started to work with Mayor Smith and local officials to identify and attract new sources of job and investment growth.”

The governor went on to say that the state will do all it can to see a sustained or increased employment in the Kokomo Delphi plants.

On Friday, Robert S. “Steve” Miller, chairman and CEO of Delphi, made good on his prediction with a restructuring plan that calls for cutting 8,500 salaried jobs and shutting one-third of Delphi’s plants worldwide. The company also asked a judge to void its labor contracts and reject some unprofitable contracts with General Motors Corp., its former parent and largest customer.

Delphi said its actions could help it emerge from bankruptcy in the first half of 2007 as a lean, focused and profitable company. But they also could provoke a strike that would rattle the auto industry and push GM perilously close to bankruptcy.

The United Auto Workers warned “it will be impossible to avoid a long strike” if the judge agrees to void Delphi’s contracts and Delphi imposes its most recent wage proposal, which would cut U.S. hourly workers’ pay by nearly 40 percent.

“We disagree with Delphi’s approach, but we anticipated that this step might be taken,” Rick Wagoner, GM’s chairman and chief executive officer, said in a statement. “GM expects Delphi to honor its public commitments to avoid any disruption to GM operations.”

GM said it will continue negotiating with Delphi and its unions on an agreement to lower wages. But the UAW, which represents 24,000 of Delphi’s 33,000 U.S. hourly workers, said the company’s move could stall talks.

“Indeed, today it appears there is no basis for continuing discussions,” the UAW said in a statement.

“Delphi’s misuse of the bankruptcy procedure to circumvent the collective bargaining process and slash jobs and wages and drastically reduce health care, retirement and other hard-won benefits or eliminate them altogether is a travesty and a concern for every American.”

Delphi identified eight U.S. plants that are considered critical to its U.S. operations. They are located in Kokomo; Brookhaven and Clinton, Miss.; Grand Rapids, Mich.; Lockport and Rochester, N.Y.; and Warren and Vandalia, Ohio. Delphi said those plants will focus on profitable parts such as safety features, electronics, diesel and gas powertrains and climate control products.

Twenty-one other U.S. plants that do not make core products — including those that make brakes and chassis, instrument panels, door modules and steering components — would be sold or closed by 2008 under Delphi’s plan. That includes plants in Anderson; Milwaukee; Dayton and Kettering, Ohio; Laurel, Miss.; Athens, Ala.; and Flint, Adrian and Saginaw, Mich.

Analysts said Delphi made the only choice it could to ensure its survival.

“I think Steve Miller did what he had to do. He threw the softest hardball he could, by seeking to negotiate but starting the clock,” said Pete Hastings, an analyst with the investment company Morgan Keegan & Co. “I think he’s doing what he needs to do to make Delphi in the U.S. profitable.”

The Associated Press contributed to this story.