Abstract

The case describes the huge employee pension, healthcare and retirement benefits related liabilities of GM which according to industry analysts may lead the company into bankruptcy. It explains how these liabilities got accumulated over the years and mentions the measures taken by GM to pay them. The case also discusses the reasons for the continuous decline of GM’s market share in the US automobile industry. The case ends with the analysts’ view on how GM should solve its problems.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Appreciate the importance of sustainable plan to fund post retirement employee benefits
• Examine the role of labor unions in GM’s pension fund problems.

Keywords

GM, Post Retirement Employee Benefits, Pension Fund, Healthcare Costs, United Auto Workers, Pension Obligations