Auto supply giant Delphi Corp. is laying out plans for a future that will focus on its electronics and electrical connections operations but back away from interior parts.
The Troy, Mich.-based company has been operating in Chapter 11 bankruptcy protection since October. In March 31 filings with the U.S. Bankruptcy Court in New York, the firm said it is seeking approval to sever its existing labor contracts.
The high price of labor has been a focal point in talks about the firm's future, with Delphi anxious to lower its manufacturing costs and United Auto Workers members fighting to retain their standard of living.
The battle has prompted fears the union could strike - a move that also could shut down Delphi's largest customer, Detroit-based General Motors Corp. and potentially send the automaker into bankruptcy.
The court has postponed a hearing on Delphi's labor request until May 9-10, in hopes of having the company and union come to an agreement.
Delphi also has laid out its core and noncore product lines for the future. The core lines include plastics-intensive operations within the electrical and electronic connections systems operations, safety parts and heating and air conditioning.
The firm specifically gave its support to Delphi Packard operations in Warren, Ohio, and a cable production facility in Clinton, Miss. Packard's Connection Systems unit, based in Warren, has invested in two new plants and 240 new injection molding presses in the past four years.
The news release also specified the heating and air-conditioning manufacturing plant in Lockport, N.Y., as a vital site. The plant created a new HVAC duct system that won an award from the Society of Plastics Engineers in 2005.
On the chopping block are cockpits and instrument panels and door modules. The Delphi decision joins moves by other top interior suppliers, including Lear Corp. and Visteon Corp., to reduce their dependence on sales of interior plastic parts.