Delphi Corp., the troubled auto-parts maker, won permission to cancel healthcare benefits for 15,000 current and former salaried workers, saving $1.1 billion as it tries to emerge from court protection amid falling vehicle sales.
U.S. Bankruptcy Judge Robert Drain in New York issued the ruling after witnesses for Troy, Mich.-based Delphi testified that the cuts were vital to its survival because its lenders demanded them. About 1,600 objections were filed by workers.
Ending the benefits will save $70 million a year and eliminate $1.1 billion of debt, Delphi said. The company has said its value has fallen so much that it may be unable to cover debt accrued while in bankruptcy.