I remember a saying as a child about what a tangled web we weave. Well, this isn't about deception, but it's still unbelievably complex. And the future of the US auto industry looks to be in the balance.
According to the Dow Jones Newswires:
Auto parts maker Delphi Corp. announced Friday a broad employee buyout program that takes the company a step closer to emerging from bankruptcy and reduces the risk of a strike that could cripple former parent and top customer, General Motors.
Bankruptcy and a strike. Talk about a 1-2 punch.
So what happens at Delphi could sink GM? Talk about having all your eggs in one basket.
Delphi spokeswoman Claudia Piccinin said that there (are) 22,000 UAW employees at Delphi and those hired before March 22 are eligible for buyout or early retirement.
I'm wondering what the cumulative effect of those buyouts will have on Delphi's ability to deliver their goods.
GM spokeswoman Toni Simonetti said that the costs of the program, which is being split 50-50 with Delphi, are already factored in to GM's financial forecasts. In the fourth-quarter, GM took a $3.6 billion after-tax charge for early retirement programs.
How nice of GM. It kind of reminds me of professional baseball, where routinely they pay for players who are no longer with the team. Of course, baseball has no competing league to lose fans to.
GM and Delphi don't have that luxury.
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