General Motors deposits $4 billion into pension fund
The General Motors IPO last month went well for the company and for the federal government, with the General bringing in billions in fresh cash and the feds reducing their ownership in the automaker, but what is GM going to do with all of that money? The company has previously announced a new advertising program with the PGA (click here for more on that) as well as increased community programs with a focus on the Detroit area (click here for more on the charity auction for Detroit Public Schools). Today, GM announced that they would be spending another $4 billion to help get their pension program closer to a break-even point.
Of the $4 billion being sent to the pension fund, $2.7 billion is going to the portion that benefits hourly workers and the other $1.3 billion will go towards the salaried workers. When the GM pension fund was “remeasured” last December, the audit showed a deficit of over $17 billion so while this $4 billion investment is only a drop in the bucket; it is a step in the right direction as GM looks to secure the future of their workers.
In other GM spending news, the company has also paid off a $1 billion debt owed to a “Korean revolving credit facility”, showing the General Motors is using the proceeds of the IPO to help reduce debt around the world while also making moves to take care of those people who make GM tick.