Dechra Pharmaceuticals (LSE:DPH)
Historical Stock Chart

From Jun 2019 to Jun 2024

General Motors Co. has agreed to cover a portion of retiree medical and pension costs for members of a union representing thousands of GM and Delphi Corp. (DPHIQ) workers, the trade group said Tuesday.

The auto maker will contribute to the pension plans of Delphi retirees covered by the IUE-CWA, an industrial division of the Communications Workers of America union. The company also will continue to fund health-care coverage for younger-than-65 retirees of a GM truck factory in Moraine, Ohio, who also are represented by the IUE-CWA.

GM had already struck deals with its largest union, the United Auto Workers, to cover Delphi pension shortfalls and retiree medical costs.

Pension plans held by Delphi, GM's former parts arm working to emerge from bankruptcy protection, had been turned over to the Pension Benefit Guaranty Co. GM has agreed to cover the difference between PBGC payments and the amount initially pledged to retirees.

The auto maker made a similar deal with the UAW. Retirees of the Moraine factory will continue to receive health benefits, though at a lower level than GM agreed to in the labor deal struck before the auto maker entered bankruptcy protection in June. Retirees older than 65, who are eligible for the federal Medicare program, will receive no benefits.

"We're not happy people who worked long and hard will not get their full benefits," said IUE-CWA President Jim Clark. "But the devastation we were on track for has been averted." Clark said roughly 41,000 retirees and their dependents are covered under the deal, though many may be covered by alternative plans.

A bankruptcy judge must approve the deal.

-By Sharon Terlep, Dow Jones Newswires; 248-204-5532; sharon.terlep@dowjones.com.