Delphi Tries To Renegotiate UAW Agreement

CHICAGO October 10, 2005; Reuters reported that bankrupt auto parts supplier Delphi Corp. will ask a judge to void its labor contracts if it cannot reach agreement on wage and benefit concessions from its unions by mid-December, the company said in court papers.

Delphi filed the largest bankruptcy in U.S. automotive history on Saturday after failing to negotiate a restructuring with former parent General Motors Corp. and the United Auto Workers union.

Delphi, the largest U.S. auto parts supplier, said it would file motions on December 16 to void the contracts and eliminate retiree health and life insurance benefits. It proposed starting a court hearing on these matters on January 17.

The company said it plans to submit written proposed contract changes to the unions on or before October 21.

Chief Executive Steve Miller told Reuters on Saturday to expect a significant reduction in U.S. employment and manufacturing operations, including dropping 4,000 idle UAW workers the company pays under its contract, and others as a reduction in operations makes them unnecessary.

The company aims to eliminate underperforming U.S. plants, which potentially includes about a dozen previously identified as unprofitable.

The UAW on Saturday called the bankruptcy a bitter pill.

Delphi has 50,600 employees in the United States, including about 34,750 hourly workers that are almost entirely represented by unions.