Workers may run four Delphi plants as UAW agrees to wage cuts

Mumbai: Bankrupt auto parts maker Delphi Corporation plans to retain and operate four plants under a tentative agreement with the United Auto Workers, a document on the web site run by its union members said.

The United Auto Workers Union, meanwhile, ended efforts to keep pay and benefits at the auto-parts maker the same as at former parent General Motors Corp. UAW will brief Delphi workers on a contract that ends the union's eight-year fight to keep wages, people familiar with the matter said.

The agreement calls for former GM workers to take pay cuts in exchange for bonuses of as much as $105,000 or buyouts and allows Delphi to close or sell all but four of 18 US factories covered by the contract, the people said. The UAW plans ratification votes at most Delphi plants June 28, they said.

The four plants to be owned and operated by Delphi are in Kokomo, Indiana, Grand Rapids, Michigan, and Rochester and Lockport, both in New York State.

Troy, Michigan-based Delphi would divest stake in another four units on an ongoing basis and would wind down or consolidate 10 plants, according to the Memorandum of Understanding posted on www.SoldiersofSolidarity.com.

The accord at Troy, Michigan-based Delphi, GM's largest supplier, ends a two-year dispute that threatened the automaker with a costly strike.

Delphi had been looking for steep cuts in wages and benefits as well as the flexibility to close or sell plants in order to compete against low-wage parts suppliers from China and elsewhere.

GM has estimated its exposure to the Delphi restructuring at $7 billion and said it could take a $1 billion charge this quarter for a settlement. GM, which spun off Delphi in 1999 and remains Delphi's biggest customer, faces its own labour talks with the UAW next month.