GM: Focus is on health-care costs, Delphi
"We'll continue to drive for cost-effective agreements to resolve the Delphi restructuring and to further reduce our still unsustainable health-care bill, which was a staggering $4.8 billion in 2006," GM Chief Executive Rick Wagoner told shareholders in a statement at the start of the company's annual meeting.
Separately, Wagoner said in response to a question that GM had not considered going private like its smaller rival Chrysler Group, which was acquired in May by Cerberus Capital Management in a $7.4-billion deal.
"At this time, GM has not considered and is not considering going private," Wagoner said.
GM has been in negotiations with Delphi and the United Auto Workers union since late 2005 over a range of issues centered on contractual terms for the unionized work force of the parts supplier as it emerges from bankruptcy.
Delphi remains GM's largest supplier and a work stoppage at the company has been seen as a lingering risk to GM, which estimates its exposure to Delphi at $7 billion.
GM, like Ford Motor Co. and the Chrysler group, also faces its own contract talks with the UAW this summer aimed at replacing a four-year deal on wages, benefits and work terms that expires on Sept. 14.
GM lost an estimated $1,436 for every car sold in North America last year, and Wagoner said the automaker would be looking to the upcoming UAW negotiations to increase its cost-competitiveness.
"We've made a lot of progress with UAW leadership in the past several years and we look forward to building on that in upcoming negotiations," he said.
Separately, Wagoner said GM is considering restructuring and selling its medium-duty truck unit.
Wagoner told investors that the automaker is also "looking at offers" to sell its Allison Transmission subsidiary. GM earlier this year said it was considering strategic options for the Indianapolis-based division, which makes transmissions and hybrid propulsion systems for commercial trucks, buses and military vehicles.
ACCOUNTING ISSUES
CFO Fritz Henderson said GM is "actively addressing" accounting issues it mentioned in its last annual report. The automaker filed its annual report in March after a six-week delay, which it blamed on recurring accounting problems, and said its internal controls on financial reporting had been ineffective.
GM pledged to tighten its financial controls after twice restating results and delaying its fourth-quarter report.
"We are actively addressing the issues we identified in the annual report," Henderson said at the Delaware meeting.
"We have a new controller, a new chief accountant," he said. "We've brought in over 30 accountants since the annual report ... to address the shortage of skilled people."
GM last month said U.S. securities regulators were reviewing its accounting for foreign exchange and commodity derivatives and said a similar hedge-related probe into its former finance arm, General Motors Acceptance Corp., could force it to restate results again.