Ford to fund a new health plan for company retirees

Article by Christian A., on August 29, 2010

Under a U.S. Labor Department proposal, Ford Motor Co. would be allowed to transfer company securities to a voluntary employee beneficiary association (VEBA) trust to fund a new health plan for company retirees.

In a statement released very recently, the department said that the plan is expected to cover more than 285,000 retirees and their dependents, as well as a small number of active retirees.

Just so the VEBA plan can keep a larger amount of securities than what is allowed under the law, the government had proposed that Ford's request for an exemption under the Employee Retirement Income Security Act be granted.

The department related that the plan originated from a 2007 agreement between Ford and the UAW. Ford spokeswoman Marcey Evans said that its health care costs were completely out of control and so the company had to do something to manage it.

Meanwhile, department spokeswoman Gloria Della said that Ford was the last of the Detroit 3 to separate its retiree health plan assets from those of its active employees.

Moreover, Ford will contribute to the trust two promissory notes payable to the VEBA, warrants to buy Ford common stock, and $580 million in cash. VEBA also will be funded with assets from other Ford health plans.

Topics: ford, united states

If you liked the article, share on:

Comments

Recommended

Kia is taking things a step further with the new Kia Stinger, which they first introduced at the 2017 Detroit Auto Show. With the specs given to us by the...
by - June 25, 2017
Earlier this week, Nissan revealed a teaser of the new 2018 LEAF’s interior, giving us an idea of what the electric vehicle has to offer. The company released a video...
by - June 25, 2017
The primary suggestion of a 4x4 ute from French company Peugeot was first revealed in 2016. Fifteen months later, the production version is launched. Now, Peugeot is not shying away...
by - June 24, 2017
The new Jaguar E-Pace crossover will soon hold its official launch on July 13 and is expected to arrive at the showrooms by early next year. It couldn’t have come...
by - June 24, 2017
As prices of the original Shelby Cobra have skyrocketed into astronomical proportions, there are firms like Superformance that serve replicas to consumers who demand the same levels of performance at...
by - June 24, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries