Auto Industry Faces $30 Billion Pension Gap, Fitch Says
USA Today Online (10/15/02)

Fitch Ratings announced that auto-related companies, including General Motors, Ford Motor, Goodyear Tire and Rubber, and Cummins, could face $30 billion in underfunded pensions, compared to just $13.9 billion in 2001. The gap between adequate pensions and current pension levels is swelling due to a 20 percent drop in the Wilshire 5000 index, which contains many stocks used in the auto industry's pensions--about 55 percent to 75 percent of those pensions are invested in stocks. The gap in GM's pension rose from $9.1 billion to $17 billion, while Ford's gap rose from $596 million in overfunding to a deficit of $5 billion. In related news, Merrill Lynch estimated that 98 percent of the companies listed in Standard & Poor's index would have underfunded pensions in 2002.

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