The PBGC said it stepped in because the company failed to pay more than $7 million in legally required pension funding contributions. The plans are also too underfunded to pay benefits when due and Intermet, currently in Chapter 11 bankruptcy proceedings, will not be able to continue supporting the plans, according to the PBGC announcement.
The four affected pension plans are: the Lynchburg
Foundry LLC Retirement Plan for Hourly Employees; the
Wagner Castings Co. Pension Plan; the Retirement Plan for
Employees of Columbus Foundry Represented by USW Local
No. 2948; and the Ganton Technologies LLC Racine Hourly
Employees Retirement Plan. According to PBGC estimates,
the plans are about
49% funded, having combined assets of $62 million and benefit liabilities of $126 million. The agency expects to cover $62 million of the $64 million total shortfall.
The announcement said two other Intermet pension plans are unaffected by the takeover of the others and will remain ongoing under the company’s sponsorship: the Ganton Technologies LLC Pulaski Hourly Employees Retirement Plan, and the Ganton Technologies LLC Salaried Employees Retirement Plan.
As of January, the agency estimates, PBGC-insured pension plans sponsored by employers in the automobile industry had unfunded benefit liabilities totaling over $60 billion (see Outgoing Pension Insurer Director Cautions about Carmaker Shortfalls ).