American Axle & Manufacturing Holdings Inc. (AAM) on January 11 announced that 1,473 United Auto Workers-represented associates agreed to participate in AAM's special attrition program.
AAM's special attrition program was offered to all UAW represented associates at AAM's master agreement facilities. AAM's master agreement facilities are located in
Under this special attrition program, AAM offered a range of early retirement incentives, buyouts and educational opportunities to its associates. Associates who retired as part of this program will retain all vested pension and postretirement benefits. Associates who accepted a buyout will retain vested pension benefits but forfeited other post-retirement benefits.
Approximately 265 retirement-eligible associates participated in this program, while an additional 1,208 associates elected one of the buyout options at these facilities. More than 1,300 of these associates have left the company before year-end 2006.
"The special attrition program accelerates our ability to realign our hourly workforce with actual and projected production and market conditions," said AAM co-founder, chairman and CEO Richard E. Dauch. "The structural cost benefit to AAM resulting from the special attrition program and other related restructuring actions should exceed $100 million annually. This will enhance our ability to invest in the continuing expansion of AAM's product portfolio, served markets, customer base and global manufacturing footprint."
On October 4, 2006, AAM estimated that it would incur special charges of as much as $150 million to $250 million in 2006 for the special attrition program and other restructuring activities. AAM currently estimates that the total cost of the special attrition program will approximate $140 million. This includes an estimated charge of $10 million for pension and postretirement benefit curtailment and special termination benefits. This includes costs associated with salaried workforce reductions and supplemental unemployment benefits estimated to be payable to UAW represented associates who are expected to be permanently idled through the end of the current collective bargaining agreement in February 2008, AAM now expects to incur special charges in a range of $175 million to $200 million for these items in 2006.
In addition, AAM also announced January 11 that it plans to idle a portion of its
AAM is a world leader in the manufacture, engineering, design and validation of driveline and drivetrain systems and related components and modules, chassis systems and metal-formed products for light trucks, sport utility vehicles and passenger cars. In addition to locations in the United States (in Michigan, New York and Ohio), AAM also has offices or facilities in Brazil, China, Germany, India, Japan, Luxembourg, Mexico, Poland, South Korea and the United Kingdom.
