GM, Ford shares up on talk of UAW concessions
JPMorgan Chase & Co. said the potential for the UAW to accept radical change and grant "better-than-expected" concessions in the upcoming summer contract negotiations could lead to a potential "near-doubling in GM" share prices to nearly $50.
GM shares were trading at $37.69 late this morning, up 93 cents, or
2.6%, from Monday's close.Ford shares were trading at $9.20, up 13 cents, or 1.4%, while DaimlerChrysler shares were flat and Toyota's U.S. shares were down.
Analysts from JPMorgan and Goldman Sachs said a UAW agreement with supplier Dana Corp. last week could signal a willingness by the union to convert retiree health-care liabilities into funds run by the union.
Dana announced last Friday a proposed agreement with its major unions
-- the UAW and United Steelworkers union -- that included transferring its retiree health care liabilities to the unions in return for funding those liabilities at 71 cents on the dollar.
Top executives at the Detroit automakers have said they are interested in examining the possibility of a similar health-care arrangement.
Analyst Robert Barry from Goldman Sachs said he expects a "modest, positive read across for GM to the extent the Dana ... deal evidences cutting retiree health benefits is on the table at the UAW."