Delphi's bankruptcy filing could lead to job losses

Robert "Steve" Miller used to make $1.5 million a year, but he announced Monday that starting in January his salary will be just $1 a year. It isn't really as strange as it might seem.\nMiller is the chairman and CEO of Delphi Corp., which filed for chapter 11 bankruptcy protection Oct. 8. During bankruptcy hearings and the subsequent deal-making with unions, reducing executives' salaries is a common tactic.\nDelphi Corp., an auto parts supplier, employs 6,500 people in Indiana, and because of its bankruptcy filing, those workers are facing drastic wage cuts, reduced health care coverage, a lower pension and possible job loss.\nDelphi had been negotiating with the United Auto Workers union that represents many of the Indiana workers, but when these negotiations failed, the corporation felt it needed to file for chapter 11 bankruptcy protection to be able to continue its operations, a statement released Oct. 8 said.\nWith high pension costs and the current "burdensome" labor contract, the corporation could not be competitive, the statement said.\nWith chapter 11 bankruptcy, the business continues to operate so the workers will keep receiving their current salary and benefits until a deal is reached with the union or the court vacates the current labor deal.\nDelphi expects to emerge from bankruptcy in early to mid 2007 as a fully functioning company, the statement said.\nAnderson, with around 1,000 workers, and Kokomo, with 5,500 workers, are the two cities in Indiana with Delphi employees.\nEven though Delphi has said it might close some factories, Kokomo Mayor Matt McKillip said he is optimistic the Kokomo plant will make it through the bankruptcy process.\nDelphi told McKillip the portion of Delphi headquartered in Kokomo, Delphi Electronics and Safety, is profitable. But, anything could happen.\n"We are hopeful but don't know," he said.\nDelphi is the second largest employer in the city. With 5,500 employees in a city of 46,000, the Kokomo economy would be drastically affected if the plant were to close.\nMany other businesses in Kokomo are also related to or work with Delphi. In addition, the jobs at Delphi are high-tech jobs the city wants to attract, he said.\nEven if it keeps the headquarters, with some workers possibly facing wage cuts from $27 to $10, the economy will still be hit hard.\nAnderson Mayor Kevin S. Smith is trying to not overreact, he said.\n"The world of business is in perpetual motion," he said\nThe city of Anderson isn't new to job cuts by large corporations. It used to have 24,000 General Motors workers. Delphi, a spin off of GM, now is down to 1,000.\nThe city has made a great effort in the last 22 months to diversify its economy to better deal with possible job losses like this, Smith said.\nIn the past 12 months alone, it has attracted four new small businesses to the city. The city shouldn't only worry about Delphi leaving, he said. Instead, it is trying to attract new businesses to Anderson.\n"We're not letting the grass grow under our feet," he said.