What Is The Delphi Part? Part 1

October 7th, 2005

Delphi is in the NEWS and trying to survive. Can Delphi management and labor work an ethical, mutually beneficial solution out for everyone concerned? Let’s hope so. Perhaps they can step up and create a solution.

“Delphi wants to cut wages from $27 an hour to $10-$12 an hour and eliminate a jobs bank that gives full pay to 4,000 laid-off workers, officials from UAW Local 292 in Kokomo, Ind. said in the letter, which was posted Thursday on a union Web site. Delphi has about 25,000 UAW-represented workers.” This is what got my attention from the Yahoo! article from AP, titled “Delphi Asks UAW to Cut Wages, Benefits”, which got me wondering. According to the article, which lays out some pretty clear issues that stand between Delphi, the UAW and GM.

In days gone by, management has used tactics supposed to benefit the ‘Shareholders Value‘.

I ask did those tactics work? No.

Obviously they need to rethink the current possible outcome of Bankruptcy by October 17, 2005 and again cut a deal that the U.A.W. and their members won’t like. “The auto parts maker is not cash-strapped…” A Trustee, of course, will determine, under the current Bankruptcy Code, what to liquidate of Delphi’s contracts, without much adieu. However, after the 17th that will change, then it will be much tougher to reduce or wipe clean certain contracts and obligations.

Management now has the leverage to regain a competitive position and remove the uncompetitive deal that the Union sold its members to address the heavy unemployment situation in ‘Detroit‘. The challenge remains how to look and proceed for the greater good, which has been neglected for decades.

John (CarGuru Sr)

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