Detroit, MI – DETROIT (AP)
General Motors has nailed down another deal in its battle to stay out of bankruptcy court. It's struck a cost-cutting agreement with the United Auto Workers union.
The tentative three-way deal between the UAW, GM and the government would cut the cost of labor, close plants and change the way health care for retirees is funded.
The union is not disclosing details pending a meeting Tuesday in Detroit at which terms will be explained to local union chiefs. After that, it's still subject to a vote by rank-and file autoworkers. A brief union statement today makes no mention of plant closings or foreign production, items the union has been contesting.
GM has said it plans to shut down 16 factories, which would put 21,000 hourly employees out of work.
The company has until June 1 to clear a restructuring plan with the government. And it still has the difficult task of persuading bondholders to swap the $27 billion they're owned for $27 billion in unsecured debt. Some analysts think that's going to be nearly impossible.