Uncertain future faces Delphi workers

Chapter 11 move raises job cut fears

TIM MARTIN

Associated Press

October 10, 2005

SAGINAW, MICH. -- Delphi Corp.'s bankruptcy protection filing on Saturday leaves workers with an uncertain future as the auto parts supplier tries to regain its financial footing.

The Troy, Mich.-based company, which was spun off from General Motors Corp. in 1999, has 50,000 U.S. employees. In Michigan, they include more than 6,500 in Michigan's Saginaw area and another 1,400 in the Grand Rapids area, nearby Coopersville and in suburbs of the city of Wyoming.

The potential for job cuts could mean another blow to Michigan's struggling economy. The state had a 6.7-per-cent seasonally adjusted unemployment rate in August, nearly two percentage points above the national average.

Delphi workers knew times could get tough well before Saturday's filing for Chapter 11 bankruptcy protection, which was designed to shield the company from creditors.

Delphi chairman and chief executive officer Robert Miller had threatened to take the company into Chapter 11 if he failed to reach a restructuring agreement with GM and its largest union, the United Auto Workers, which represents about 24,000 Delphi workers.

"As far as I'm concerned, we'll restructure and reorganize and try to get rid of what is dragging us down," said Tim Krzeszewski, 52, a sheet metal worker from Saginaw who works at a nearby Delphi steering plant. "I guess it will be up to the courts. There's not much we can do. It's kind of out of our hands now on both sides."

Delphi had asked the United Auto Workers union to accept wage cuts of more than 50 per cent and eliminate a jobs bank that gives full pay to 4,000 laid-off workers, the letter said.

Analysts have said they doubt Delphi could get such large-scale concessions without filing for bankruptcy protection.

Delphi's decision doesn't bode well for Michigan's economy over all, which is already reeling from outsourcing, Governor Jennifer Granholm said.

In Indiana, where Delphi is the state's third-largest manufacturer, communities were rattled by the bankruptcy filing. The company has 7,500 employees in Indiana -- about 5,500 of them based in Kokomo, where Delphi's electronics and safety division is headquartered.

Union halls have been flooded with calls from employees and retirees wondering about what might happen with their pension and health-care benefits, but many workers do not expect any sudden changes now that a bankruptcy court will sort out the options.