Botching the Pesky but Basic Details on a Big Story

Reporters count up the numbers in the General Motors and Delphi buyout plans -- apparently relying on some "fuzzy math" while doing so.

In a startling attempt to save their own hides, General Motors and Delphi announced this week that they will offer buyouts and early retirement packages to more than 125,000 workers, with GM set to pay between $35,000 and $140,000 to each employee who agrees to quit.

The landmark agreement between GM, Delphi (the former GM unit which is now the nation’s largest auto parts maker) and the United Auto Workers comes with GM reeling under the weight of massive pension and health care obligations to its retirees, a major reason its North American operations have been bleeding nearly $25 million in cash per day. Moreover, GM continues to lose market share, Delphi is bankrupt, and the once-mighty UAW, finding itself tethered to a sinking industry, has been forced to make one big concession after another while losing members and influence. The UAW, as one observer told USA Today, is negotiating “an end game,” while the chief economist at the Center for Automotive Studies remarked to the Washington Post that Wednesday’s agreement marks “the end of 20th-century industrial America and hopefully the beginning of 21st-century industrial America and a globalized auto industry.”

It is an epic story, and the nation’s newspapers responded accordingly. The news landed on the front page of the Post, the Los Angeles Times, the New York Times, and the Baltimore Sun, while USA Today published a 1,600-word analysis on its Web site, and the two Detroit dailies and the Wall Street Journal all ran comprehensive packages.

The grand sweep of the story was thus captured more than adequately. But the devil is in the details, and in this case a number of print journalists botched some of the basic figures central to the complex buyout deal.

In the 37th paragraph of its lead piece, the Los Angeles Times accurately reported the numbers of workers affected: “The buyout offer was made to all 113,000 of GM’s hourly workers in the U.S. About 13,000 of Delphi’s UAW workers were offered the chance to retire. As many as 5,000 Delphi workers could [also] transfer to GM’s payroll.”

By contrast, in the third paragraph of its A01 story, the Washington Post misreported part of that, writing in reference to GM, “It is unclear how many of the auto goliath’s 105,000 hourly workers will take the buyouts, though a significant portion are expected to.” GM actually has 113,000 hourly workers in the United States; 105,000 of those, as the Wall Street Journal pointed out (subscription required), are currently represented by the UAW.

For another example of confusing numeracy we move to Bloomberg News, which got the number of Delphi workers eligible for its retirement offer right, but did not mention the 113,000 GM workers eligible for a buyout (it wrote that GM has “about 105,000 active U.S. hourly union workers”), and inexplicably declared in its second paragraph that “About 141,000 GM and Delphi employees would be eligible for the buyouts and retirement incentives.” As both the Los Angeles Times and the Journal’s math indicates, however, the grand total of workers who can possibly be offered some sort of deal (including a return from Delphi to GM) is 131,000 — a full 10,000 short of Bloomberg’s errant figure.

It was the Atlanta Journal-Constitution, however, that inadvertently produced not one, not two, but three misleading numbers in its short report on GM Thursday.

The AJC’s lead read: “General Motors Corp. offered about 100,000 hourly workers … early retirement buyouts Wednesday worth up to $140,000.” Nearly every source across the land correctly reported the 113,000-worker figure here, but the AJC (which, it should be noted, relied on Bloomberg for part of its story) was apparently content to be 13,000 or so workers off. (The difference is no small matter to GM, which “aims to trim 30,000 jobs nationwide” by 2008.)

In its third graf, the AJC reported that “A less lucrative offer was presented Wednesday to the 34,000 hourly employees of Delphi Corp.” — even though, as the Associated Press noted, it is actually 13,000 hourly workers who “will be eligible for a lump sum payment of $35,000 to retire” at Delphi.

Last but not least, we draw your attention to the AJC’s third and final goof: “GM suffered losses of $10.6 million last year.” If that were so, the company which the Post described as once being “the cornerstone of American manufacturing and cultural might” would be positively giddy, Rick Wagoner would be dancing in the streets, and Fortune would not have run a cover story entitled “The Tragedy of General Motors.” But the sad truth is GM lost $10.6 billion last year — and it is fairly incredible that no one at the AJC caught the mistake.

The miscues above are far from tragedies, but they are perplexing. Getting a story right means getting all of it right, including the pesky but basic details — especially on such a big story as this one. When it comes to this watershed development in the history of American automobiles, a number of reporters and editors, most glaringly at the AJC, fell asleep at the wheel.

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Edward B. Colby was a writer at CJR Daily.