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NAVISTAR WITHDRAWS RETIREE HEALTH CARE SUIT AND BEGINS NEGOTIATIONS WITH UAW

 NAVISTAR WITHDRAWS RETIREE HEALTH CARE SUIT
 AND BEGINS NEGOTIATIONS WITH UAW
 CHICAGO, Oct. 16 /PRNewswire/ -- Navistar International Corp. (NYSE: NAV) today announced that it has withdrawn its declaratory judgment action in U.S. District Court for the Northern District of Illinois in Chicago and is beginning negotiations with the United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) to resolve issues affecting both retired and active employees.
 The company also said it would join other parties involved in asking the U. S. District Court of the Southern District of Ohio in Dayton to stay a related lawsuit filed on behalf of retired salaried and hourly Navistar workers. The purpose of the stay is to allow time to resolve the economic issues facing Navistar, its retirees and active employees. As part of the stay, Navistar has agreed not to terminate or modify benefits for any retirees or eligible dependents for the duration of the discussions.
 The company and the UAW have agreed to a goal of resolving the issues by early December.
 "We are very pleased with this development," said James C. Cotting, chairman and chief executive officer of Navistar. "We have stated from the outset that if our very serious cost issues are not addressed quickly, Navistar's solvency would be threatened. It has been our goal to resolve this issue short of litigating it to finality. Now that there is a framework to resolve the issues for all retirees and to deal with issues affecting active employees, we believe we can accomplish our goals more expeditiously through negotiations. We also believe that withdrawing our suit in the Chicago court and joining the request for a stay of the Dayton court lawsuit will facilitate the process of resolving these issues quickly and fairly."
 Navistar's management previously announced that the company has a significant cost disadvantage when compared to other industrial companies generally in the same line of business, resulting from both excess operating costs and costs for health care for active and retired employees.
 Navistar spends a significantly higher percentage of its sales revenues on retiree medical benefits than its competitors because of its unusually high ratio of retired to active employees. Primarily as a result of downsizing it the 1980s, Navistar has more than three retirees for every active worker, compared to an industry average of less than one-to-one.
 "We are committed to resolving our cost disadvantage so that Navistar can survive, grow its business and continue to provide jobs to our nearly 13,000 employees, and pensions and health care over the long term for our active and retired employees," Cotting said.
 -0- 10/16/92
 /CONTACT: Mary Moster of Navistar, 312-836-3240 or home 312-943 2674/
 (NAV) CO: Navistar International Corp. ST: Illinois IN: MAC SU:


TM -- NY085 -- 1205 10/16/92 18:41 EDT
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Publication:PR Newswire
Date:Oct 16, 1992
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