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Gettelfinger credits GM, not Delphi, for tentative deal

From AP| June 26 , 2007

DETROIT (AP) - United Auto Workers President Ron Gettelfinger credited General Motors Corp. on Monday for a tentative wage-concession deal with Delphi Corp. meant to help the struggling auto supplier emerge from bankruptcy and avoid a strike.

Delphi has about 6,000 workers in Ohio. Under the plan, GM or a third party it chooses would operate a plant in Dayton, Ohio.

Meanwhile, Gettelfinger continued to criticize Delphi's leaders, whom he said wanted to drag out the bankruptcy and put the Troy-based Delphi in foreign hands.

"If it weren't for (GM Chief Financial Officer) Fritz Henderson and his team ... this agreement never would have come about," Gettelfinger said in an interview on "The Paul W. Smith Show" on WJR-AM in Detroit.

Delphi spokesman Lindsey Williams said the company would not respond to Gettelfinger's comments.

Gettelfinger wouldn't give details of the agreement, signed Friday by Delphi and UAW leadership. Union members were expected to hear details beginning Monday on the pact, which still must be approved by the 17,000 UAW members and a federal bankruptcy judge in New York.

But according to documents obtained by the AP that the union provided to its members, the deal would provide three annual payments of $35,000 each to UAW workers who previously had worked for higher wages at GM before the 1999 Delphi spin-off. There are about 4,000 of these so-called "legacy workers," but it was unclear how many would receive the payments.

Under the agreement, legacy workers would see their hourly wages cut from around $27 to between $14.50 and $18.50 beginning Oct. 1. During the buydown period, those workers also could try to return to GM.

Other incentives include:

A $140,000 buyout for workers with more than 10 years of service and a $70,000 buyout for those with the company for less than 10 years.

A $35,000 payment to encourage workers with at least 30 years of service to retire.

Retirement benefits for workers age 50 and above with at least 10 years of service.

A program for workers with at least 26 years of service that would allow them to stop working, but be paid as active workers at the lower rates until they reach 30 years of service and retire.

The plan would have Delphi operating four UAW plants: Grand Rapids; Kokomo, Ind.; Lockport, N.Y.; and Rochester, N.Y. The union was able to get GM - or a third party designated by GM - to agree to operate Delphi's Flint East plant, Saginaw Chassis and the Needmore Road plant in Dayton, Ohio.

Delphi plans to sell its Saginaw Steering plant and others in Adrian; Sandusky, Ohio; and Cottondale, Ala. It would close or consolidate into other facilities in Coopersville; Columbus, Ohio; two in Milwaukee; Anderson, Ind.; and Wichita Falls, Texas.

The deal brings to a close two years of contentious negotiations in which the UAW threatened to strike. The animosity has not ended with the tentative agreement.

In the printed materials sent to members, the union said the new contract "can't heal the pain Delphi management" has inflicted on workers and their communities.

While Gettelfinger said the union was loath to make any announcements until it met with its leaders, he said Delphi officials "jumped the gun" on Friday by making the news public.

"They had to be in front acting like they're in charge," he said.

He said Delphi executives have made hundreds of thousands of dollars in bonuses while workers have accepted cuts and face losing their jobs. Gettelfinger said the union is fighting to keep plants in the United States.

"They have no interest in staying in the U.S.," he said.

Called the "Transform Your Ride Sale," the event will be advertised on television, radio, print and online. The television spots will incorporate scenes from the new movie.

Smaller rival Ford Motor is also expected to announce a major new incentive program this weekend, according to a person familiar with the plans.

Both GM and Ford have held incentive spending largely flat this year as part of an attempt to move away from the kind of blowout sales and volatile monthly sales tallies that dogged results for the Detroit automakers earlier this decade.

U.S. automakers typically offer big consumer incentives in the summer months just as they are working down inventory levels in anticipation of a new year of model launches beginning in the fall.

Detroit's automakers have been struggling to hold their retail market share amid near record-high gasoline prices, a weak housing market and fierce competition from Japanese rivals led by Toyota Motor Corp. - which earlier this month announced its own rebates of up to $3,500 on the Tundra pickup truck.

GM's vice president of sales, Mark LaNeve, told reporters last week the overall U.S. auto market remained "challenging" but "not awful."

U.S. auto sales rose just under 1 percent in May, adjusted for an extra selling day. On the same basis, GM's sales rose 6 percent, while Ford's sales fell 10 percent.

Auto sales incentives are widely tracked by analysts as an indication of the relative profitability of competing automakers and the pressure that they face to move inventory.

Automakers do not typically disclose how much they spend on incentives, which can include concessional financing, cash rebates or additional payments to dealers.

GM's average incentive spend per vehicle through May this year was $2,775, up slightly from $2,704 a year earlier, according to an estimate by industry tracking firm Edmunds.

Ford's average spend was $3,084, down slightly from $3,131 a year earlier.

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