, the bankrupt parts supplier trying to avert a strike that could devastate the auto industry, on Monday dropped a threat to reject a collective bargaining agreement with its unions on Dec. 16.
Delphi suspended its previously announced deadline and said it will not petition the bankruptcy court for such a rejection until at least Jan. 20, 2006. While operating under Chapter 11 bankruptcy protection, Delphi remains a major supplier to automakers, particularly former parent
GM shares jumped 76 cents, or 3.3%, to $23.62 after the news hit.
In addition to the suspended deadline, Delphi said GM agreed to temporarily forego previously agreed-to 2006 price reductions on components provided by Delphi, "to provide interim financial support." Last week, Delphi sought court permission to extend pre-petition contracts with about 8,000 suppliers as long as they were willing to rescind previously implemented price increases.
"These constructive actions demonstrate a willingness to accelerate efforts to achieve consensual resolutions to the significant challenges facing Delphi," the company said in a release. Delphi said it would have no further comments regarding "GM's role in the potential outcome or resolution of the issues" while its discussions continue.