By on December 1, 2010

Both Toyota and the remains of its joint venture known as NUMMI have sued the remains of “Old GM” for breach of contract according to two separate reports in the Wall Street Journal [sub]. NUMMI is seeking $365m, claiming GM caused the collapse of the joint venture by unilaterally pulling out as it collapsed into bankruptcy,  sticking Toyota and NUMMI with the bill.

Those decisions breached … commitments to Nummi and sounded its death knell,” said the lawsuit, filed last week. And unlike Toyota, GM’s bankruptcy estate “has refused to contribute to Nummi’s deficit during the wind down”

Toyota, meanwhile, is suing for some $73m in development costs for the Pontiac Vibe, a vehicle that GM was supposed to sell for another two years.

Toyota has reportedly been in settlement talks with Motors Liquidation Corp (aka “Old GM”), but failed to reach an agreement with its former partner. And because Motors Liquidation is facing far more claims than it has money to pay out, these lawsuits may be about more than just money. UAW workers were encouraged to hold protests around California and the country in the wake of NUMMI’s shutdown, blaming Toyota for “killing American jobs.” These lawsuits might not put Toyota in front of (for example) asbestos claims or any of the other demands on Old GM’s dwindling funds, but if they win it will prove once and for all that GM, not Toyota was responsible for killing NUMMI.

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20 Comments on “NUMMI, Toyota Sue “Old GM” For Contract Breaches...”


  • avatar
    jimbowski

    At least Tesla Motors bought and is using the building.  Got a good deal on the price, too.

  • avatar
    AaronH

    Obviously GM killed NUMMI…Who does Toyota have to prove that to? Those maggots in the above picture? Who cares about them besides parasite politicians. GM was jumping for joy when they just left NUMMI without consequence…YeeHa…What a parasite that thing was/is.

    • 0 avatar
      mikey

       @ Aaron.. I think I have a way to resolve your problems with the UAW. The next time they set up a picket line, go there and express your views, face to face. Let it all out dude,you know, parasites maggots the whole bit. I’m sure you will  better.

    • 0 avatar
      jkross22

      Mikey, The sign those guys are holding represents how many of us non-union guys see the union.  Blaming someone else and an equally strong entitlement attitude certainly helped push the perception of Ford, GM and Chrysler over the cliff.
       
      Regardless of stock market performance, there are A LOT of people unemployed.  Seeing union guys holding these signs reminds the rest of us that the UAW has a sense of entitlement for lifelong employment regardless of the overall economic conditions.
       
      Reality is that if the D3 had been producing quality vehicles all along, there would have been no reason for millions of consumers to buy Toyandissans.

    • 0 avatar
      mikey

      Jkross…I respect, and understand your opinion sir,and you express it in a civil manner. However you would be shocked to know how little input the guy on the line has.

      Make no mistake..GM management ran the company to the ground while paying themselves massive salarys and perks.

      The UAW/CAW just fought for our slice of the pie,or,as you say entitlement.

      What if we had of agreed to concessions 10 years ago? Would GM have suddenly woke up,and started building quality smaller cars that would compete against Honda/Toyota? Or would they have continued on, creating bigger and bigger fiefdoms? All the while stuffing thier pockets with more, and more, money. 

       I think you know the answer sir.

  • avatar
    SkiD666

    GM didn’t ‘kill’ NUMMI, Toyota and $$$ did.
    The Vibe made up a small percentage of production.
    Toyota closed the plant so they could produce the Tacoma and Corolla in cheaper locations.

    • 0 avatar
      psarhjinian

      Yes and no.  Canada is hardly a “cheaper” location for Corolla production, but the Cambridge plant is more flexible than NUMMI, as is the Tijuana Tacoma plant.  Plus, Toyota does have the very new, very capable and very underutilized Tundra facility in San Antonio that could use the Tacoma volume.
       
      Without GM’s commitment, there was no reason for Toyota to keep NUMMI open when it had newer, better and, I suppose, cheaper plants that were already under-utilized.

    • 0 avatar
      Steven02

      psar,
      I agree with you, but GM had only something like 10% of the volume at NUMMI.  There aren’t that many Vibes around.  GM backing out of NUMMI allowed Toyota to do what it already wanted to do, which was to get out of NUMMI quick.

    • 0 avatar

      GM killed NUMMI!! I Worked for NUMMI for 16yrs, at the time of the plant closure I was a Union Rep, Trustee, and member of the Executive Board. I saw firsthand the political side played by the UAW in the outcome of the plant closure. I can write a book about this issue but for the purpose of this post will only leave you guys with this question: Since the UAW has 17.5% ownership of GM, and we helped the Obama administration get into power, and this administration had the power to fire GM’s CEO, why we couldn’t use our influence or even attempted to ask GM to keep building the Vibe which was a great selling vehicle for GM? Furthermore, why when I personally questioned the UAW International Union Vice President on the issue, talking points were given and every effort was made to keep us from questioning GM’s responsibility. This law-suit will bring out some answers we all been waiting for!! Toyota pulled out cuz they didn’t want to be a unionize plant, however, they would have remain in Fremont as a joint venture had it not been for GM.

  • avatar
    cmoibenlepro

    Saying the Toyota killed American jobs is like saying that homosexuality causes kills of Americans in Iraq.

    What a non-sense.

    UAW killed the American car industry, and caused GM and Chrysler bankruptcy, which killed all the American jobs.

  • avatar
    tparkit

    Let’s recall that Toyota caved in to Ray DaHood and Washington/UAW extortion, to the tune of $250 million.

    http://www.thetruthaboutcars.com/2010/03/toyota-pledges-250m-for-nummi-closure/

    So what changed? Why is Toyota battling back now?

    Simple. The Democrats got wiped out in the November election. The sort of perversion represented by the phony bankruptcies of GM and Chrysler – brutal, extralegal acts of theft deeply damaging to America’s ability to attract investment – likely can’t happen in the current political climate, partly because House Republicans can freeze any Democrat program.

    Of course there are no guarantees -  but past capitulations bought Toyota no protection, so if the company is going to go down it may as well go down fighting.

     

    • 0 avatar
      psarhjinian

      The sort of perversion represented by the phony bankruptcies of GM and Chrysler – brutal, extralegal acts of theft deeply damaging to America’s ability to attract investment

      Every week we prove that this wasn’t the case, and yet every week it gets vomited back up like so much 3am Chinese take-away on a Saturday night.

    • 0 avatar
      tparkit

      What you mean, psarhjinian, is that every week you keep carrying water for the statist Left.

      It’s hard to hide the facts and the results, though. The phony bankruptcy, with its massive political payoff paid for by stripping creditors of their rights, gave the UAW a windfall. Gosh, hoocoudaknode?

      http://www.washingtontimes.com/news/2010/nov/25/gms-union-on-road-to-recovery-after-stock-sale/

    • 0 avatar

      The sort of perversion represented by the phony bankruptcies of GM and Chrysler – brutal, extralegal acts of theft deeply damaging to America’s ability to attract investment
      Every week we prove that this wasn’t the case,….
      Tell that to my buddie’s aged mother who lost a large part of her retirement income when her GM bonds stopped paying and became nearly worthless!

    • 0 avatar
      Steven02

      tparkit,
      Seriously dude, take off the tinfoil hat.  It wasn’t illegal.  No rights were stripped.  Everything you are saying is incorrect.  Please, don’t act like a stock sale by the UAW somehow proves the point that this was an illegal bankruptcy.  If the stock was worthless, the UAW wouldn’t have gotten anything either.
       
      Bill Safreed,
      While I understand that people were hurt through the bankruptcy process, the people holding those bonds would have gotten no money if GM went chapter 7.  Unsecured debt doesn’t get anything during bankruptcy.

  • avatar
    Steven02

    NUMMI and Toyota are suing for breach of contract.  They are not suing to prove that GM pulling out is why NUMMI was closed.  Either way the lawsuit goes, it won’t prove the cause of NUMMI closing.
     
    NUMMI was closed because Toyota didn’t want it.  GM’s production was something like 10% of production coming out of NUMMI.  Toyota could have kept going with a slow down of volume if they wanted to.  Toyota decided not too because it had excess production elsewhere and didn’t want or need NUMMI.  I don’t blame Toyota for pulling out.  It was a smart business move.  But it wasn’t GM business that was keeping the place going.  Not by a long shot.

  • avatar
    FleetofWheel

    Be careful UAW, you’re giving Toyota street cred with these dire claims of ‘killing’.
     
    Expect to see aftermarket decals featuring that sinister Toyota death skull logo on the new FT-86 when it rolls out.

  • avatar
    Crabspirits

    That picture with the tubby SOB holding the kanji sign embarrasses me as an American. Nobody really is responsible for themselves anymore. The majority of the rest of us without an extortion arm would just suck it up and say “Well, that’s life.” and start looking for new employment.

    • 0 avatar
      disney4dad

      Hey Crab, You know that’s just what I did. As soon as I heard the place was closing I went home cried on my wife’s shoulder and then started looking for a new way of putting food on the table. This waiting for a knock on the door or that phone call, yea right it’s not going to happen. And for the ones thinking Tesla is going to call, don’t hold your breath. They have thousands of people to call. Unless your a technician or have skills that put you above others, your not going to get a call or at least not now maybe after they get the plant going and need more workers but that’s not for years to come. As for me I’ve gone into the green industry, I just received my certificate as a Electric Vehicle Technician. Oh and it was all covered by the TAA program. CleanTech Institute was the place I went to. Check them out at Cleantechinstitute.org      I know Tesla’s going to call me.


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