Autopia.org - View Single Post - Should the government bail-out include domestic automakers?

Len_A · 11-21-08, 04:03

Apparently, contrary to the naysayers, I'm not the only one who thinks a GM, Ford, OR Chrysler bankruptcy filing will cause severe problems in the supplier community:

THE AUTO INDUSTRY BAILOUT

Cooper-Standard executive chairman outlines plight of supply chain

Robert Sherefkin
Automotive News
November 20, 2008 - 4:16 pm ET

DETROIT -- Auto parts executive James McElya said the bankruptcy of a major automaker would cause a chain reaction that would reach from suppliers down to the neighborhood diner, the barber and even the schools.

McElya told a congressional committee yesterday that a bankruptcy would cause "a chain reaction of unpaid payables with subsequent additional bankruptcies that will severely and negatively impact the entire sector."

McElya's comments were eclipsed in media reports by testimony from the Detroit 3 CEOs and UAW President Ron Gettelfinger. McElya was the only supplier leader to testify on the impact of the auto crisis on the supply chain.

"Today's auto industry," said McElya, executive chairman of Cooper Standard Holdings Inc. and its principal operating company, Cooper-Standard Automotive Inc., "is so interdependent such that it is economically impossible to separate the economic success of the suppliers from their manufacturer customers."

At the same time, suppliers must have an infusion of working capital to continue to operate, he said in testimony for a hearing before the House Financial Services Committee.

The committee held a hearing on legislation that would provide $25 billion in emergency federal loans to the Detroit 3 and possibly suppliers. The Senate Committee on Banking, Housing and Urban Affairs held a hearing on similar legislation Tuesday.

McElya also is chairman of the Motor and Equipment Manufacturers Association. The organization has urged Congress to pass legislation immediately that provides direct financial assistance to the automotive industry, including auto manufacturers and suppliers.

McElya said the dramatic and sudden contraction of the auto industry would also hurt transplant automakers. "Toyota, Honda and Nissan will likely have to close or limit production while waiting for new sources of supply to be developed."

11-21-08, 04:03	#210 (permalink)
Len_A Outta Work In Detroit Len_A is offline Join Date: Aug 2001 Location: Westland, MI (Detroit suburb) Posts: 678 Contact:	Re: Should the government bail-out include domestic automakers? Apparently, contrary to the naysayers, I'm not the only one who thinks a GM, Ford, OR Chrysler bankruptcy filing will cause severe problems in the supplier community: THE AUTO INDUSTRY BAILOUT Cooper-Standard executive chairman outlines plight of supply chain Robert Sherefkin Automotive News November 20, 2008 - 4:16 pm ET DETROIT -- Auto parts executive James McElya said the bankruptcy of a major automaker would cause a chain reaction that would reach from suppliers down to the neighborhood diner, the barber and even the schools. McElya told a congressional committee yesterday that a bankruptcy would cause "a chain reaction of unpaid payables with subsequent additional bankruptcies that will severely and negatively impact the entire sector." McElya's comments were eclipsed in media reports by testimony from the Detroit 3 CEOs and UAW President Ron Gettelfinger. McElya was the only supplier leader to testify on the impact of the auto crisis on the supply chain. "Today's auto industry," said McElya, executive chairman of Cooper Standard Holdings Inc. and its principal operating company, Cooper-Standard Automotive Inc., "is so interdependent such that it is economically impossible to separate the economic success of the suppliers from their manufacturer customers." At the same time, suppliers must have an infusion of working capital to continue to operate, he said in testimony for a hearing before the House Financial Services Committee. The committee held a hearing on legislation that would provide $25 billion in emergency federal loans to the Detroit 3 and possibly suppliers. The Senate Committee on Banking, Housing and Urban Affairs held a hearing on similar legislation Tuesday. McElya also is chairman of the Motor and Equipment Manufacturers Association. The organization has urged Congress to pass legislation immediately that provides direct financial assistance to the automotive industry, including auto manufacturers and suppliers. McElya said the dramatic and sudden contraction of the auto industry would also hurt transplant automakers. "Toyota, Honda and Nissan will likely have to close or limit production while waiting for new sources of supply to be developed." __________________ *Never argue with an idiot. They drag you down to their level, then beat you with experience.* Outside Sales, Out of work over a year and counting...