By DEREK R. SMITH, Kokomo Tribune staff writer
A new Delphi Corp. wage and benefits offer to the United Auto Workers — one that would gradually cut the pay of a production worker to an average of $16.50 per hour, or to $12-$13 in a second scenario — will be up for discussion today in Detroit.
Pressure is sure to be high as the clock ticks down toward a Thursday deadline for negotiators to reach a comprehensive agreement — a deadline Delphi says it won’t extend.
Initial reaction to the Delphi offer by Kokomo’s UAW Local 292 doesn’t bode well.
“This proposal is no better than the proposal they gave us Nov. 15, 2005,” said Local 292 president Sona Camp. “There’s no way we’ll accept this.”
Local 292 received a 43-page copy of Delphi’s latest offer via FedEx Monday afternoon.
Part of the Local 292 document is a letter from Kevin M. Butler, Delphi’s vice president of human resources management, to UAW Vice President Richard Shoemaker.
“ ... In the event that we do not reach a comprehensive agreement by [Thursday], this is the proposal that Delphi intends to include in its Sections 1113 and 1114 motion to be filed with the bankruptcy court on [Friday],” the Delphi letter says.
Butler’s letter says the document outlines two approaches for Delphi to cut costs — one that assumes additional financial assistance from GM and a second that does not.
“The second alternative is based on the assumption that Delphi must restructure without any financial support from GM except that to which GM has already committed,” the letter says. “These terms are largely the same terms that were included in our proposal on November 15, 2005, and remain consistent with the discussion in our transmittal letter to you on that date.”
High stakes
Delphi, GM and the UAW each kept quiet Monday about the new Delphi offer.
Delphi spokesman Lindsey Williams would not confirm to The Associated Press that a new proposal was on the table.
GM spokesman Jerry Dubrowski declined comment to The Associated Press.
UAW spokesman Paul Krell told The Associated Press the union had received the proposal, but declined comment on details.
If a federal bankruptcy judge throws out Delphi’s collective bargaining agreements, a devastating strike could result.
Kokomo Delphi worker George Piwowar said he was not pleased by details of the Delphi deal reported Monday morning by The Detroit News.
Piwowar, 55, said he has worked for the company for 34 years and would like to work another five or six years, but believes he doesn’t have much of a choice in accepting a retirement buyout offer.
“I think it’s a shame. The UAW for years has been going forward and now we’re going backward,” he said. “I feel betrayed by the government, betrayed by the company and betrayed by the union.”
Garry Hyman, a Kokomo Delphi worker with 36 years seniority, said he had seen The Detroit News numbers, but like many local Delphi workers was waiting for more information before deciding whether to accept a retirement buyout.
“I still have to see more information, particularly on timeframe. You know, how long will it take to trend down to the lower figure?” he said. “I still have to wait to see what the retirement package is going to be. It takes a total package for me — not only wages, but everything.”
Although he expects Delphi’s Thursday deadline to be extended, Hyman said he is finding the Delphi negotiations “harder to read as each day goes by.”
GM spun off Troy, Mich.-based Delphi, the nation’s largest auto supplier, in 1999.
Analysts with Center for Automotive Research and AutoPacific were unavailable Monday.
Buyout agreement
Last week, Delphi, GM and the UAW announced a landmark buyout agreement.
Under Delphi’s plan, up to 5,000 workers would be eligible to return to GM, while 13,000 of the auto supplier’s U.S. hourly workers would be eligible for a lump-sum payment of up to $35,000 to retire.
Another buyout option would be available for Delphi workers with 27 to 29 years of seniority. Those workers would receive between $2,800 and $2,900 gross monthly wages for agreeing to retire at 30 years.
Anthony said 784 local Delphi hourly workers have at least 27 years of experience, while another 200 to 250 should fall into three early retirement-eligible categories. He said early indications suggest that up to half of the 1,000 to 1,100 eligible employees might accept retirement or early retirement.
A Delphi employee accepting any retirement option can retire from Delphi, or can “check the box” and be considered a “flowback” to GM for purposes of retirement.
If Anthony’s prediction proves correct, and a federal bankruptcy court approves the agreement, Delphi could see up to one-fourth of its local hourly work force retire.
Delphi filed for Chapter 11 reorganization bankruptcy Oct. 8, citing globally uncompetitive costs.
Delphi has about 185,000 employees in six divisions worldwide. Kokomo is world divisional headquarters of Delphi Electronics & Safety and home to about 5,200 of the division’s 29,900 employees.
The Associated Press contributed to this report.