Parts suppliers running for Cover
On May 15, Chrysler began to notify 1,200 suppliers its plans to pay for claims that came before the filing for bankruptcy. In court, they disclosed a primary list of affected suppliers. They also included the cost of the claims for each supplier. Contracts with these suppliers are expected to continue with the new company created by the sale of most Chrysler assets.
The list of suppliers is not final and Chrysler will continue to work with suppliers who want to work with the newest company.
Suppliers with the largest payments include Continental AG (Germany) and Johnson Controls (Milwaukee). Both companies are planned to receive about 70 million. Magna International (Canada) is targeted to receive just over 63 million.
The suppliers are going to receive about ½ of what is owed in increments over the next several weeks. The rest of the payment is expected to come after the sale with Flat Group SpA (Italy).
Chrysler said it would negotiate with suppliers who disagree on the amount owed to them. Judge Arthur Gonzales will hear any objections on the June 4th court hearing.
Toyota has been researching new suppliers in the past 12 months in anticipation of the financial problems caused by GM and Chrysler’s financial woes. They have taken necessary precautions and they are believed to be set for future difficulties. I guess we will know when you and I go into your local Toyota Parts department. The counterman will inform us if the part we need is on terminal Backorder or if it is readily available like it always has been.
Some Auto parts Assembly lines may be in danger because of Chrysler filing for bankruptcy
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