Detroit, MI – The health care costs have been a major drag on GM's operations.
The news is coming from a speech by chairman and CEO Rick Wagoner. He says the agreement is subject to ratification by the UAW rank and file.
It says the deal should help GM save $15 billion, or 25%, on costs for retirees and another $3 billion a year for employees.
GM has been under growing financial pressure because of rising health care costs and slumping sales. Monday morning, it reported a quaterly loss of $1.6 billion. It's major auto poarts supplier and former subsidiary, Delphi, has filed for bankruptcy protection.