GM Can't Feed Its Child
Bankrupt United States car parts maker Delphi has decided to temporarily close a plant in China’s Suzhou, the Hong Kong’s South China Morning Post (sub) reports. The factory west of Shanghai makes compressors for General Motors Corp. Delphi had been spun off from GM, as Visteon was from Ford, and Denso from Toyota. All with the (at least official) idea to supply other automakers of the world as well.
Unfortunately, it didn’t work out that way for the Suzhou plant: “The sudden and unprecedented decline in car sales globally has resulted in our only customer, General Motors North America, announcing plant closures and plant stoppages,” the South China Morning Post quoted from a statement by Delphi. “Unfortunately our only customer in 2009 is GMNA, and this has placed the Suzhou compressor plant in a very dangerous position,” the document continues.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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We all know that Delphi and Visteon were built on a bed of sand. First, these money losing: plants, union contracts, prices for parts, etc, were simply taken off the GM & Ford balance sheet and tossed overboard to a new company with no chance of profitability. Then to add insult to injury, the price the big two were willing to pay these spinoff's parts was tightened to attempt making a profit at GM & Ford on the money losing cars these parts went into. On a column way back, I said where will Delphi & Visteon get the ability to sell the parts for less? The answer was obvious, make the parts cheaper. Now you have to say, do I want to buy a car made from cheap parts? This being especially true if a car is the sum of it's parts. We now have that answer of parts from bankrupt entities be they made in the US or China.
Here's a story on your Hungry Man Breakfast From Hell, read the nutritional label info it's the best part: http://www.x-entertainment.com/articles/0744/
Usta Bee, thanks for that link...though stomach churning, it was very funny. Back to Delphi...I wonder if they are sufficiently removed from GM that they can apply for their own bailout. Come to think of it, who can't apply for a bailout?