Delphi bankruptcy has more to do with crooked executives than labor costs

[OzarkDem]

Earlier this year there was a quiet little scandal involving Delphi and its CFO and a few other execs who resigned over "accounting irregularities".

How convenient they're now blaming the bankruptcy on labor costs when its actually due to corporate malfeasance. Following is an article from last June that talks about the resignations and investigations by the SEC and FBI.

http://www.detnews.com/2005/autosinsider/0506/09/01-210488.htm

Delphi's accounting probe began internally last fall and is now being conducted by the SEC and FBI. Delphi's chief financial officer Alan Dawes and its controller Paul Free resigned over accounting errors in March.

Blahnik was demoted in March to a non-executive position from vice president. Blahnik joined GM's finance staff in 1978 and had been with Delphi for 10 years, Baucus said. Geller joined GM in 1992 and had been at Delphi for eight years.

Delphi has said previously it improperly accounted for $237 million in cash payments for warranty claims to its former parent, General Motors Corp., among other errors.

[Lerkfish]

1. that's only one part of the elephant.

There are at least this many factors:

1. management screwups (which you already mentioned)
2. Unions outpricing labor beyond their value. (though I am a union man myself, being as even handed to all factors as possible)
3. Soft market on SUVs and other vehicles supplied by Delphi parts.
4. Increased foreign intrusion into the market with cheaper parts.
5. Soft market on cars just in general (why do you think they did "employee pricing" for so long?)
6. Brittany Spears
7. being a vestigial element of GM that has not reached performance goals. (keep in mind, many of these plants have been on "double secret probation' for a years now, and have NOT increased their worth or value.

[kcass1954]

3. Okay, I'll bite - Why is Brittany part of this equation? n/t

[Lerkfish]

4. just to make sure you were paying attention :) nt

[kcass1954]

5. Thanks! Was this a test?!? Did I pass?!? n/t

[Lerkfish]

6. nah, just me being silly.

no test. I REPEAT, my posts do not require a litmus test.

[Double T]

2. Corporate CEOs and Management have created a culture of corruption...

that pervades throughout corporate America. Not only do we need to replace our government officials, corporations need to replace their cliquey board of directors along with the CEOs and Management. Corruption of our businesses and governments is taking this country down and the future will be bleak without rapid reforms.