LETTER 28

GP7000 Assembly and Test

Mr. James M. Parent

Assistant Directing Business Representative

District Lodge No.  26

International Association of Machinists and

Aerospace Workers, AFL-CIO

365 New Britain Road

Kensington, CT 06037

Dear Mr. Parent:

This is to confirm the following understanding and agreement between the Company and the Union concerning the placement of work associated with the final assembly and testing of the GP7000 engine within facilities identified in Article 2 of this Agreement.

1.         Letter 22 of this Agreement provides certain protections for work presently and normally manufactured by employees covered by Article 2 of this Agreement.   It does not address the issue of whether or not new work will be placed in the bargaining unit.  Those decisions are made on the basis of a business judgment supported by data concerning productivity and efficiency.

2.         During the term of the last Agreement, management set goals for continuous improvement in the areas of cost, schedule, quality and delivery that the workforce has met and, at times, exceeded.  These results demonstrate that the Connecticut workforce can compete and win in an increasingly competitive business environment.

3.         As a direct result of these successes, the Company, within thirty (30) days after the ratification of this Agreement, will announce the decision to place within the bargaining unit at its Middletown facility new work associated with the final assembly and testing of the GP7000 engine. 

4.         As the Company and the Union move forward, new, ambitious, but attainable goals for improvements in cost, schedule, quality and delivery will be set.  Achievement of those goals will be the clearest evidence supporting the attraction and retention of new work for Connecticut, such as the final assembly and testing of the GP7000 engine.

Sincerely,

James R. Miller

Vice President, Industrial Relations

Accepted this 6th day of December 2004