General Motors could save billions of dollars this year by passing on a greater portion of its health care costs to UAW members.
"There are lots of reasons for our tough start to 2005 -- an intensely competitive market, the tough pricing environment, pull-ahead sales into the last quarter, rising interest rates, legacy costs, skyrocketing health care costs," said GM North America President Gary Cowger.
Cowger was the featured speaker at a breakfast sponsored by the International Motor Press Association on Wednesday.
"This is possibly the most critical element, and perhaps the toughest" for GM's financial turnaround. "We must make progress this year on health care costs, which are spiraling out of control," said Cowger.
Cowger said an across-the-board competitive health care plan for salaried and hourly employees "could save GM billions of dollars a year."
"We need to continue and accelerate the progress we've already made on health care, and be even more aggressive in pursuing solutions leading to tangible results. We have to work with all our employees to find and enact solutions this year."
In an interview session later that day, GM Vice Chairman Bob Lutz said that if UAW members had a health care plan comparable to the automaker's salaried staff, "that would represent substantial savings to the company."
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