Will healthcare costs bankrupt GM?

General Motors Corp. and the United Auto Workers union appear headed for a historic clash as spiraling health care costs seemingly threaten the very survival of the world's largest carmaker. GM reported Tuesday it lost $1.1 billion in the first quarter, its largest quarterly loss in more than a decade, and it cited the cost of providing health coverage for its workers and retirees as a main culprit. GM didn't provide details of what it spent in the quarter for medical expenses, but it has said the bill for covering its 1.1 million employees, retirees and family members is likely to approach $6 billion in 2005, up 15 percent from last year's tab of $5.2 billion. "Addressing health care is our top objective," GM chief financial officer John Devine said Tuesday. But it may be years before any concrete results are evident. That's because the current four-year labor agreement with the UAW runs through 2007, and union leaders said last week they have no intention of renegotiating the current contract. Instead, they said they'd do what they could within the agreement to help GM reduce health care spending. AP Story