Loading…
Saturday, July 26, 2014
Current Weather
Loading Current Weather....
Published: Tuesday, 6/27/2006

Area GM workers finding early exits attractive

BY JULIE M. McKINNON
BLADE BUSINESS WRITER

John Whitt of Oregon couldn't pass up the $35,000 incentive to leave early from General Motors Corp.'s Toledo Powertrain factory.

"I used to like going to work," said Mr. Whitt, 62, who worked at the transmission factory for about 28 years. "I didn't like it anymore."

He is among more than 1,225 Toledo Powertrain workers - or more than a third of the factory's 2,900 hourly employees - who accepted retirement or buyout offers from GM as the world's largest automaker tries to winnow its U.S. workforce.

About 600 of the 2,100 workers at GM's Defiance Powertrain foundry took the deal.

Nationwide, 35,000 workers grabbed the early-exit packages, GM officials said yesterday.

In all, 30,400 workers have accepted the $35,000 retirement incentives, and 4,600 not eligible for them have taken buyouts ranging from $70,000 for those with less than 10 years and $140,000 for those with more than 10 years, said Rick Wagoner, GM's chairman and chief executive.

Workers accepting the retirement incentive receive full pension benefits at age 65; those accepting a buyout give up all post-retirement benefits, including health care, but vested pension benefits would not be affected. Those accepting the incentives have seven days to change their minds.

The programs will help GM cut costs by $8 billion a year, he said, but will cost $3.8 billion this year. Mr. Wagoner is trying to restore Detroit-based GM to profit after posting $10.6 billion in losses in 2005.

The firm, which has 113,000 hourly workers, hoped to trim its work force by 30,000, and close 12 plants.

Similarly, workers at bankrupt Delphi Corp., formerly owned by GM, also were offered incentives to leave. The auto supplier said yesterday that 12,600 of 33,000 Delphi workers in the United States accepted retirement offers, and more are expected to take buyouts pending bankruptcy court approval.

At the Delphi factory in Adrian, 200 of 350 hourly workers have signed up for the incentives, a union official said.

Most leaving GM are members of the United Auto Workers. Some left before Friday's sign-up deadline. Others will leave by Jan. 1.

James Mehallow planned to retire from Toledo Powertain at year's end, but with rising gas prices forcing him to spend $60 a week to commute from Cygnet to north Toledo, he said it made sense to accept the automaker's $35,000 offer to leave early.

Likewise, Marvin Hinton, 54, of Holland, Ohio, decided to retire a couple of years earlier than expected after the Alexis Road factory outsourced the heat-treating department where he worked.

Mr. Mehallow, Mr. Hinton, and Mr. Whitt all retired June 1, and none has regretted the decision.

"I don't miss it, not one bit," said Mr. Mehallow, 59, who worked at the factory for 35 1/2 years. "I miss some of the people, but I'm glad I did it."

At the plant, some jobs will most likely be filled with temporary workers as the plant moves from building four-speed transmissions to six-speed models, said Bob Sykes, financial secretary for UAW Local 14.

GM appears to be accelerating the switch to six-speed transmissions, he said. Toledo Powertrain needs to secure more six-speed transmission work, he said.

"If we don't, we're going to end up with less than 1,000 people at the end of the day," Mr. Sykes said.

GM plans to pay temporary workers $18 to $19 an hour, compared with $27 an hour for its regular employees. Mr. Wagoner didn't have an estimate for how many temporary workers GM might need.

At the Adrian Delphi factory, 20 of the 350 workers received offers to return to GM for full-time, regular positions, said John Clark, president of UAW Local 2031.

The Delphi plant, he said, is hiring and training temporary workers to replace those leaving. He plans to retire from Delphi on Jan. 1 but, like others, doesn't want to accept the deal.

"Most people didn't, but they didn't want to take the chance of losing their pension and all they've worked for all those years," Mr. Clark said.

An estimate on how many of the 955 hourly workers in Sandusky have signed up for offers to leave Delphi was not available yesterday.

Contact Julie M. McKinnon at:

jmckinnon@theblade.com

or 419-724-6087.



Guidelines: Please keep your comments smart and civil. Don't attack other readers personally, and keep your language decent. If a comment violates these standards or our privacy statement or visitor's agreement, click the "X" in the upper right corner of the comment box to report abuse. To post comments, you must be a Facebook member. To find out more, please visit the FAQ.

Points of Interest