GM weighs pension buyout offer to UAW similar to white-collar plan

6/13/2012

DETROIT -- General Motors Co. may seek a deal with the United Automobile Workers to offer pension buyouts to union retirees similar to offers made recently to 42,000 white-collar retirees.

GM's chief executive officer, Daniel Akerson, said Tuesday that the company could discuss the possibility of pension buyouts with the UAW before the current contract expired in 2015.

"We can bring it up," Mr. Akerson told reporters before GM's annual shareholder meeting. "I'm not saying we're going to do it, but it's something we could look at if the opportunity should arise."

GM announced June 1 a broad plan to reduce its long-term pension liabilities for salaried employees.

About 42,000 of GM's 118,000 salaried retirees and surviving spouses are eligible to receive lump-sum payments in exchange for giving up their monthly pension checks.

With the moves already announced, the automaker hopes to reduce its $134 billion long-term global pension obligations by $26 billion.

The company has more than 400,000 blue-collar retirees and surviving spouses.

Mr. Akerson said pension buyouts were discussed with union leaders during last year's negotiations on a four-year labor agreement. He emphasized that there were no current discussions, but he was open to the possibility.

The pension changes were among the highlights Mr. Akerson cited in summarizing 2011 for shareholders at the annual meeting.

It "was a good year, but it wasn't a great year," he said. "We have much more work to do, because making GM great again is what we are working toward."

GM reported profit of $7.6 billion last year as it continued its comeback from its government-sponsored bankruptcy in 2009.

The company is still struggling with big losses in Europe but has returned to solid profitability in North America.