A key concern is the net savings of the deals, particularly in the near term, as company contributions to the new defined benefit plans created to shelter retirees from health care benefits cuts will largely negate any cost savings. GM, for example, is on the hook for a $1 billion contribution in each of the next three years.
Meanwhile, the income side of the ledger isn't looking to bright either, with the well-publicized shift in consumer preferences from light trucks (and big per-vehicle profits) to cars. Citibank's Jon Rogers forecasts GM North American production will fall from this year's 4.7 million vehicles to 4.5 million in 2006. His target price for GM shares? $17 - more than 9 percent below last Friday's closing.