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GM Shares Stall as Labor Deadline Looms

The automaker has taken the lead role in talks with the UAW.

Investors weren't willing to make any more big bets on

General Motors

(GM) - Get Report

Friday as Detroit's labor contract talks entered a critical juncture.

After a big rallly Thursday, GM's stock recently was flat at $33.29 amid news that the United Auto Workers union chose the auto giant as the lead negotiator in the talks.

Leading the talks is considered a positive move for GM because it makes it easier for the company to push its plan for a union-controlled trust -- called a voluntary employees' beneficiary association, or VEBA -- that will allow it significantly cut its health care obligations.

A report that the UAW is willing to consider a VEBA sent shares of GM soaring 10% on Thursday.

GM, though, has until midnight Friday to reach a deal or ask for an extension, or it will face a union strike. Detroit's other big automakers,

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, have received extensions of their contracts, according to the

Associated Press


If the sides agree on establishing a trust, the Big Three are expected to cut $95 billion from their retiree costs. They would make large one-time payments to fund trust.

In return, they would be freed from the liabilities that have increased their borrowing costs and weighed on their ability to compete with low-cost, foreign-based competitors that have been stealing market share from domestic manufacturers in North America.