Paying pensions

One thing to consider when investing is how well the company has been able to keep up with its pensions and what effect trying to keep up will have on profit. Bernard Condon writes:

Some of the biggest underfunded companies: Exxon Mobil (nyse: XOM – news – people ), which is $12 billion in arrears and 24 years away from payback; General Motors (nyse: GM – news – people ), which is $8 billion in the hole; and IBM (nyse: IBM – news – people ), which is facing $7 billion in underfunded pensions. The latter two giants need another eight and four years, respectively, to meet their obligations, which themselves are moving, and ballooning, targets.

Taking GM for an example, I read somewhere that GM is paying its retirees more than its active workforce. That seems like a competitive disadvantage to me.

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