WASHINGTON -- Pension reform sounds like a good idea. But some so-called reforms under consideration in Washington would add to the financial headaches of automakers and suppliers.
The proposal that worries industry executives most is in a Senate pension bill. It would require companies that face downgraded credit ratings to increase their contributions to employee pension funds.
"We just question the wisdom of that," says Dan Brouillette, Ford Motor Co.'s vice president of government affairs.
The proposal would hit Ford and General Motors hard. Credit rating firms have downgraded the securities of both companies to junk or near-junk status. Ford and GM insist they already are funding their employee pension plans fully.
At the very least, employers appear likely to get hit with a sharp increase in the fees they pay to the government agency that insures private pensions.
Congress and the Bush administration are pushing for changes to compel employers to keep pensions funded and to shore up the government's overdrawn insurance program.