General Motors confirmed that it has begun...

General Motors confirmed that it has begun arbitration to examine whether a reduction in the price it paid for Hughes Aircraft in 1985 is “appropriate.” The Times reported Friday that GM had begun secret arbitration proceedings as a result of an estimated $180-million loss it sustained on a Navy contract shortly after the acquisition was finalized. GM Chairman Roger Smith said GM had “recognized” the possibility of a loss on the contract and “it was agreed that an arbitration panel could be used to decide later whether or not an adjustment in price is appropriate.” Smith added that the relationship between GM and the Howard Hughes Medical Institute, which sold Hughes Aircraft to GM, is “excellent.” That contradicts reports that the relationship has grown strained.