November 7, 2005

Delphi unions to fight cost-cut plan

By David Bailey

CHICAGO (Reuters) - Unions representing nearly all of
bankrupt auto parts maker Delphi Corp.'s U.S. hourly workers
said on Monday they have formed a coalition to fight proposed
wage and benefit cuts they called an assault on working

The United Auto Workers, IUE-CWA, United Steelworkers,
International Brotherhood of Electrical Workers, International
Association of Machinists and Aerospace Workers and
International Union of Operating Engineers said they formed the
coalition Thursday.

"We are outraged by Delphi's attempt to use the bankruptcy
process to dictate the radical destruction of the living
standards of America's industrial workers ...," the coalition
said in a statement.

Unions leaders said the cost-cutting demands are especially
hard to swallow when Delphi also plans cash and equity bonuses
for several hundred executives as incentives to stay with the
company through its reorganization.

The statement did not say how the [email protected]
coalition would fight Delphi on the proposed changes, though
USW spokesman Marco Trbovich said the unions want alternative
solutions to save Delphi, not a strike.

"Radical surgery like that proposed at Delphi is no
solution at all," Trbovich said. "It is a formula for demise,
if not confrontation."

Delphi on October 8 filed for the biggest bankruptcy
protection case in automotive history. It has said it must cut
high wage and benefit costs inherited from former parent
General Motors Corp. to reorganize its U.S. operations.

"We continue to work with all of our unions in hopes of
reaching a consensual agreement before the end of the year,"
Delphi spokesman Lindsey Williams said.

The company in October told its major unions it must cut
wages to as low as $9 per hour -- from about $27 per hour -- to
compete with U.S. suppliers where wage and benefit costs can be
one-half to one-third as high as Delphi's.

Delphi also seeks steep cuts to benefits including dental
and vision and the flexibility to close plants and cut jobs for
its reorganization. The company has said it would begin the
process of rejecting its union contracts if it did not reach
agreements with the unions by mid-December.

Troy, Michigan-based Delphi has about 50,000 U.S. workers,
including 34,750 hourly employees.

The six unions represent about 33,650 Delphi U.S. hourly
workers, with more than 5.5 million active and retired members
that also offer their support, the coalition statement said.

"Together we will do everything possible to make sure their
rights and interests are protected," the statement said.

The UAW, IUE-CWA and steelworkers represent almost all of
the hourly workers under union representation at Delphi.

The IAM represents only about 50 pattern makers at a Delphi
operation in Milwaukee but intends to be an active coalition
member given its experience with multiple U.S. airline
bankruptcies in recent years, spokesman Frank Larkin said.

"The restructuring being proposed at Delphi is so extreme
and so destructive that the company may have to find a way to
file for moral bankruptcy as well," Larkin said, citing the
size and extreme cuts proposed.