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American automakers rush to finish plans for Congress

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  • For its part, the UAW is likely to be asked to give up job security guarantees for workers at US plants that close and asked to renegotiate how automakers will pay into a trust fund set to take over retiree health care from 2010.

    In addition, GM is almost certain to ask its bondholders to swap some portion of its existing $44 billion debt for a deeply discounted payout and some equity interest in the restructured company, analysts say.

    GM, Ford and Chrysler have all declined to discuss their restructuring plans before submitting them.

    Analysts say Detroit is gambling that plans that show labor, management, creditors and investors sharing in sacrifices at a time of crisis will win the political support that has so far eluded the companies. “Going in it was pretty clear that the powers that be in Washington were interested in seeing the automakers come back with plans with more concessions,” said Dennis Virag of the Ann Arbor, Michigan-based Automotive Consulting Group. “I think they will get the funding.”

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    But the complicated plans for the automakers hinge on major changes that could take months to complete.

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