GM looking for buyers for Delphi units

/ Source: The Associated Press

General Motors Corp.'s top purchasing executive said Tuesday the automaker is trying to help auto parts supplier Delphi Corp. dispose of noncore businesses by finding buyers for them and contracting with new suppliers for certain parts.

Bo Andersson, GM's vice president of global purchasing and supply, also confirmed GM is stockpiling parts in case Delphi workers strike, but he wouldn't offer details of GM's contingency plan and said the automaker is confident it can avoid a strike at Delphi, its former parts division and largest supplier.

"Our job is to keep the plants running and we have done that and we intend to do that," Andersson told reporters after a supplier meeting sponsored by the Original Equipment Suppliers Association.

Delphi, which filed for bankruptcy protection last fall, said in March that it plans to sell or close 21 U.S. plants that don't make core products, including those that make brakes, chassis, instrument panels, door modules and steering components. Andersson said GM is contacting some of its best suppliers and asking if they would be interested in purchasing those businesses.

GM also is ending contracts with Delphi for some noncore parts. Three weeks ago, GM stopped buying spark plugs from Delphi and transferred its business to Denso Corp., Beru AG, NGK Spark Plugs Inc. and Honeywell International Inc., which will make it easier for Delphi to close a spark plug facility in Flint, Mich. GM also is in the process of transferring its business for air inductions, a spokesman said.

Next month, a federal judge will consider Delphi's request to cancel its union contracts. The United Auto Workers and other unions have threatened to strike if that happens. In an effort to avoid a costly strike, GM has offered to pay for buyouts to up to 17,000 Delphi workers and allow 5,000 Delphi workers to flow back to GM.

"We are willing to spend a lot of money to get a deal with Delphi, the UAW and ourselves," Andersson said.

Around 560 people attended the supplier meeting Tuesday in suburban Detroit. GM works with 3,200 suppliers worldwide.

Suppliers asked for assurance that GM won't file for Chapter 11 protection as part of its plan to bring its North American division back to profitability. Andersson said GM is turning out better products and tackling its costs through job cuts and other measures.

"I feel that we are addressing the troubling issues," Andersson said. "Time will tell, but I have faith."