The sale and future of General Motors Co.'s Nexteer Automotive steering business in Saginaw, Mich., is in jeopardy after workers rejected more concessions demanded by management.
GM may "wind down" Nexteer's Saginaw plant if the rank-and-file vote prompts two prospective buyers to withdraw their bids, according to an internal letter sent last week to Nexteer CEO Robert Remenar by Scott Mackie, GM's executive director of new business development. The letter was obtained by Automotive News.
Mackie told Remenar GM wanted to see the concessions in place by Wednesday, June 30. That's the date of GM's "transaction signing commitment" with the buyers, according to the letter.
GM spokeswoman Kimberly Carpenter last week confirmed the authenticity of the letter. She declined to identify the prospective buyers.
On June 17, the day that Bob King was installed as UAW president, nearly 2,000 UAW-represented hourly workers in Saginaw defeated by a margin of nearly 3-to-1 a concession package that would have frozen wages for three years and cut new-hire wages to $12 an hour from $14. Another change would have cut back on medical coverage, offering insurance to new workers but not their families.
A $12-an-hour wage, without overtime, generates annual income of $24,960. The federal poverty level for a family of four is $22,050.
Nexteer is one of five former Delphi operations that GM took back last year so Delphi could emerge from Chapter 11 reorganization. GM has been trying to sell Nexteer, which makes steering systems and half-shafts.
This year, workers at a plant in Wyoming, Mich., that GM took back from Delphi rejected similar concessions by a 2-1 margin. That plant, which is not part of Nexteer, makes valve lifters.