GM and the UAW are in talks trying to slash $1 billion in annual labor costs, with reports stating that the plan would give the union a 39% stake in GM to help fund the Voluntary Employees Beneficiary Association (VEBA) health care trust. GM already has around $15 billion invested in the VEBA, but it is still on the hook for some $20 billion. If reached, the new deal would reportedly cut that figure in half.
The agreement, which the Wall Street Journal says could be reached as soon as this week, will still need to be voted on by the UAW's 60,000 GM employees, who themselves also face upwards of 20,000 more job layoffs as well as more wage and benefit cuts.
Conversely, the Associated Press is reporting that the issue remains very much in doubt, with GM and UAW negotiators battling over GM's plans to sell vehicles built overseas – namely those from China – in the U.S. While GM officials reportedly say that the balance of vehicles it makes and sells in the U.S. will not change, UAW officials are rankled that its members face 16 more plant closures and a slate of givebacks. In fact, according to the AP, the UAW is so upset that it has sent an email to its members asking them to voice their displeasure by contacting President Obama.
[Sources: The Wall Street Journal; The Associated Press | Image: Spencer Platt/Getty]