Financial Services Industry
Industry: Email Alert RSS FeedThe ties that bind: Pension, health-care liabilities are hurting Visteon's future; Arrangement with Ford means auto parts supplier is in danger of bankruptcy.(News)
Pensions & Investments, April, 2003 by Anand, Vineeta
Byline: Vineeta Anand DEARBORN, Mich. - Visteon Corp.'s ballooning pension and retiree health-care liabilities could bankrupt the company, some say. Because of an unusual arrangement with its former parent, Ford Motor Co., more than one-third of the unionized workers in Visteon plants are still on Ford's payroll and covered by Ford's pension fund.
But the world's second largest auto parts supplier must contribute cash to Ford for those 21,5000 workers for their paychecks, as well as their pension liabilities. Visteon also must start paying Ford in 2006 for retiree health-care liabilities of those workers. Visteon and Ford officials declined to discuss how much of Ford's pension shortfall - it had $29.8 billion in pension assets and $37.1 billion in...
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