Sample Essay
The filing of chapter 11 of the bankruptcy code by Delphi Corp presented a major threat to GM. This action implied the laying off of majority of plant workers which would definitely spark off strikes. With prolonged strikes, there would emerge a production crisis at GM as most of the plant would be at a standstill. Even though GM had spun off Delphi in 1999, they were wrong to continue over relying onDelphias their major supply. The collapse ofDelphiwould automatically cause the same for GM as a result of their bankruptcy. As per the collective agreement with UAW, General Motors was mandated to continue paying their workers regardless of their out of work status.
With a looming strike, GM which had already suffered the lack of auto parts in the previous year would have doubled their problems. They would go bankrupt and at the same time pay the dormant workers. More so, because GM is still liable to some of the workers at Delphi Corp and are expected to honor part of this agreement. In a specific perspective, it is clear that Delphi Corp’s filing for bankruptcy has triggered problems for both UAW and GM. As such these outstanding issues are the litigation claims by Delphi to terminate supply agreements, disputes emerging formDelphi’s spin off from GM and the claims and disputes arising from the chapter 11 case.
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