Feb. 12 (Bloomberg) -- Delphi Corp., the bankrupt auto- parts maker, faces a challenge by retirees opposed to its effort to end health-care benefits for former salaried workers.

At least 30 letters were filed in U.S. Bankruptcy Court in New York objecting to the proposal by the biggest supplier to General Motors Corp.

“I am writing to implore you to deny Delphi’s request to allow it to discontinue health care and life insurance for salaried retirees,” Erin Anheier, of Gaines, Michigan, wrote to U.S. Bankruptcy Judge Robert Drain. “While understanding that costs must be managed, this proposal places too much burden on individuals.”

Anheier said she and her husband were salaried Delphi workers who aren’t old enough to receive Medicare benefits.

The company will address the objections in court, Delphi spokesman Lindsey Williams said. A hearing on the request to end the retiree benefits is scheduled for Feb. 24.

Delphi, based in Troy, Michigan, said last week its value has fallen so much the company may not be able to cover debts accrued since filing for bankruptcy in 2005. Ending health benefits for salaried retirees would save about $70 million a year and eliminate as much as $1.1 billion of liabilities from its balance sheet.

Delphi won approval in January 2007 of a Chapter 11 turnaround plan that valued the company at about $12.8 billion. That value was later reduced to $7.2 billion. Delphi couldn’t implement the plan in April because investors led by Appaloosa Management LP backed out of an agreement to provide as much as $2.55 billion, saying the company failed to meet conditions.

The case is In re Delphi Corp., 05-44481, U.S. Bankruptcy Court, Southern District New York (Manhattan).

To contact the reporter on this story: Christopher Scinta in New York at cscinta@bloomberg.net.

Last Updated: February 12, 2009 00:01 EST