GM still has to put in a sizable chunk.
GM, which has a $51 billion tab from retiree health-care expenses, will pass the buck to the UAW after contributing 70 cents on the dollar to an independent trust designed to cover health-care costs. The UAW will then take over responsibility for the trust, called a Volunteer Employees Beneficiary Association, or VEBA.
It will help out in the long run tremendously, but current wages and benefits are still higher than the foreign guys. The two tier wage scale is a start. GM will still eventually have to shut down plants or get the UAW to agree to restructuring the pay scale.
Many companies have done this. Cummins does this locally. The 'Old Timers' still make off pretty well, but the new employees get substantially lower pay. The benefit of this was Cummins stayed in business and the workers got to keep their jobs.