NEW YORK -- General Motors CEO Rick Wagoner said the company, which reached an agreement with unionized workers that will slash healthcare costs, isn't ready to disclose a timeline for returning to profitability.
In an interview with the Wall Street Journal, Wagoner said the agreement will reduce the company's health-care cost burden relative to its competitors but "does not take that disadvantage away completely."
The United Auto Workers union on Thursday, Oct. 20, presented details of a plan calling for retirees to begin paying monthly premiums and annual deductibles for health coverage. This and other changes will slash $1 billion a year in expenses.
The plan must be approved by active UAW employees; retirees don't have a vote. Many union leaders in interviews after a briefing on the agreement said the hits were not as bad as they had feared and said they think the agreement will pass.
Wagoner said he is confident the UAW will ratify the pact.
Once the deal is ratified, GM and the UAW will accelerate discussions on U.S. plant closures. Wagoner said the company's goal is to reduce capacity enough so that the remaining sites run at 100 percent capacity, the newspaper reported.
Wagoner said GM has "a very well thought out, comprehensive and aggressive plan" to get back to profitability and is working to decide which and how many North American plants it will shut down, the paper said. But the company isn't talking about the details.
Wagoner declined to elaborate on what impact shutdowns would have on GM's work force. GM has said it would reduce head count by 25,000 or more, mostly through attrition, between 2005 and 2008.
Filing for bankruptcy protection, a path taken by GM's former parts division Delphi Corp., isn't "likely, possible or a business scenario" for GM, Wagoner said.
Wagoner also said GM is focusing on finding a large, experienced financial partner for its finance unit, the newspaper reported.