Essay: Reorganization of Delphi Corp

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Essay: Reorganization of Delphi Corp

Sample Essay

An evaluation of these alternatives depicts renegotiation, arbitration, restructuring and reorganization of Delphi as a more amicable solution. It is beneficial in the fact that it allows for equal representation and consideration of all involved parties. Workers are represented by UAW and their predicaments of reduced wages and void pension benefits addressed. Furthermore, it would guarantee them continued employment. However, there is an underlying limitation in this resolution if indeed the file for bankruptcy was not genuine then any efforts for arbitration would be sabotaged.

Furthermore, failure to reach agreements may result to never ending wrangles and increased losses for employees and GM. On the other hand, a fresh start is beneficial to Delphi in that they would get a clean slate and rebuild the company appropriately. It is however disadvantageous to them if they were to lose all their assets in the discharge which would make a fresh start impossible. As for GM and UAW they would triumph as the collective agreements would still be effected with the employees receiving their wages and benefits. The downside to this resolution for employees is the possibility of losing their jobs and also the fact that Delphi may not possess enough assets to repay employees immediately.

In the reorganization of Delphi Corp the courts are mandated to conduct follow ups on the company’s progress. In addition, the company has to create internal regulatory frameworks for the annual supervision and regulation of the company’s dealings. Evaluation methods include data collection of company expenses and sales generation. Also, the survey of the unions’ conduct and any other transactions with the company and its affiliates can be used in evaluating the progress. As discussed above, bankruptcy law and especially chapter 11 give companies the opportunity to rebuild. Delphi must take up the duty of reorganizing the company in a more appropriate and effective manner.

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