The company stopped the matching contributions late in 2001 and said they would be reinstated when the company thought it was affordable (SeeVisteon Cuts Company Match).
Before the cut, the company matched 60% of employee deferrals up to 10% of pay. The new match is 25% of deferrals up to 6% of pay, according to the Detroit News. Rick Meigs, president of 401khelpcenter.com, said the new rate was not bad, noting that average match in 401(k) plans is 50% of up to 3% of an employee’s salary.
In addition, Visteon said it is also planning changes to its pension plan.Complete details of the change have not been released, but workers were told the company will no longer provide early retirement supplements to employees who retire after July 1, 2006. Visteon spokesman Jim Fisher said the company will continue to offer a traditional, defined benefit pension program, but decided its existing plan was far more generous than those offered by competitors. He said that employment at Visteon after June 30, 2006 will be credited differently than under the current pension program.
The benefit changes will go into effect July 1, 2006.
The maker and supplier of auto parts announced a new policy earlier this year which will require most salaried employees to pay for their own health care expenses in retirement (SeeVisteon Retiree Health Care Costs to Shift to Employees).