GM takeover likely good news for Kokomo

ken.delabastide@kokomotribune.com

What goes around comes around, and in the case of the Delphi Corp. operations in Kokomo, it could be a return to General Motors Corp. ownership.

Ten years ago, Delphi spun off from GM with the hope of diversifying its business.

Since its 2005 bankruptcy filing, the number of jobs at the Kokomo Electronics & Safety facility has declined.

The Associated Press reported Tuesday that in a tentative agreement with the United Auto Workers, GM would take back ownership of five Delphi facilities, including those in Kokomo.

Lindsay Williams, a spokesman for Delphi in Michigan, said it is premature to talk about GM taking ownership of any plants.

"GM and the UAW might have an agreement, but the assets belong to Delphi," Williams said. "The status of the plants, particularly the five GM is interested in, will be outlined in our modification we file with the court.

"We need to formulate and file modifications to our accepted plan," he said of the company's effort to emerge from bankruptcy.

Local union officials declined comment until the agreement with GM is ratified.

David Cole, executive director of the Michigan-based Center for Automotive Research, said the news is likely good for Kokomo.

He said GM still has some liability for Delphi, and the five facilities are assets that have some value.

"It makes sense for them to take ownership," Cole said.

He said the Kokomo plants are centered on technology, which makes it an asset.

"The microchips are so integrated into the cars," Cole said. "That's a high value, the number of chips will continue to grow."

Cole said the federal government would want GM to keep the most valuable assets.

"The next few days will be full of turmoil," he said.

Mike Kennedy, president of the Kokomo Common Council and a Delphi retiree, believes GM ownership would be a positive action.

"That's the way it used to be," he said. "Most of the products are for GM, there is one Toyota line.

"I would certainly guess the products would continue to be built," Kennedy said. "If GM decided to move where the products are made, that would not be a positive."

Kennedy said he believes the change in ownership would bring some stability for the workers. He noted that if the work went to another location, the Delphi employees could transfer to another GM facility or go along with the jobs to another production facility.

"I believe this is a positive for the community," he said.

Kennedy said when Delphi spun off from GM in 1999, he thought it would be a good thing, but within 18 months things started getting gradually worse.

"When they filed for bankruptcy in 2005, then we knew things were bad," he said. "Originally I was very excited because I thought it would diversify our business."

Kennedy said the Kokomo plants continue to manufacture several key product lines that GM depends on.

"I hope it's a good thing and more jobs are created," he said.