DOW JONES NEWSWIRES
The U.S. government's insurer of private pension plans is taking
over four plans covering about 4,500 workers and retirees of
bankrupt auto-parts maker Intermet Corp. (INMTQ) after the company
failed to contribute more than $7 million to the plans.
The Pension Benefit Guaranty Corp. said it stepped in because
the metals-castings maker will not be able to continue supporting
the four plans, which are unable to pay benefits when due and are
just 49% funded. As of January, PBGC-insured pension plans
sponsored by employers in the automobile industry had unfunded
benefit liabilities totaling over $60 billion, according to PBGC
estimates.
The agency expects to cover $62 million of the $64 million
shortfall using insurance funds. Two other Intermet funds are
unaffected.
Intermet, like other auto-parts manufacturers, is suffering from
its link to struggling auto makers General Motors Corp. (GM),
Chrysler LLC and Ford Motor Co. (F), which have been slashing
output in light of plunging sales.
The company last August filed for bankruptcy protection for the
second time in four years. Intermet is focused on larger vehicles,
sales of which have seen some of the biggest declines in the
industry. The company makes parts for power trains, chassis and
electronics.
-By Mike Barris, Dow Jones Newswires; 201-938-5658;
mike.barris@dowjones.com