GM: "Delphi Could Force GM Into an Uncontrolled Shutdown"

Robert Farago
by Robert Farago

Ah, Delphi. I remember predicting—what, two years ago?—that parts maker Delphi’s collapse would drag GM into bankruptcy. Well, just as GM is falling into C11 on its own accord (so to speak), it seems the ghost of subdivisions past are about to . . . drag GM into bankruptcy. The Detroit News reports that GM’s sent up an emergency flare. “In light of adverse developments in the industry, at GM and at Delphi, GM has been in negotiations with Delphi and its lenders to arrive at solutions that would ensure GM’s source of supply under fair and reasonable terms,” GM said in a statement today. “While GM has proposed a potential solution that would allow for the successful and rapid resolution of Delphi’s bankruptcy case, its lenders have rejected this proposal.”

Check this: GM now says the scheduled nine-week summer shutdown is Delphi related, not a non-sales related adjustment of production to demand. Reuters reports an interim “solution” to Delphi’s implosion: “Delphi has until May 4 to deliver details of its agreement for an additional $150 million from GM. The deadline for that agreement has been postponed several times, most recently by the intervention of the U.S. Treasury.” Gee, I wonder why. Tsk tsk. Another mouth to feed—with out taxes, ‘natch.

GM agreed earlier this year to increase to $450 million the payments it has promised to the parts maker, from an originally agreed $300 million.

GM is also seeking court approval to buy Delphi’s steering business, a transaction opposed by various parties and also blocked by the U.S. Treasury. The court will hold hearings on the matter next month.

Don’t worry! The Presidential task Force on Autos will handle this! Alternatively, do. Worry, I mean.

Robert Farago
Robert Farago

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  • Moedaman Moedaman on Apr 24, 2009
    ZoomZoom : April 24th, 2009 at 11:28 am Re: Comments from moedaman, cardeveloper, MikeInCanada. I just don’t get it. If the car manufacturers were so horrible about paying for parts (and I don’t doubt you on this), then why even do business with them? I always wondered that myself. But sadly, in the Detroit area, those were the vast majority of jobs available. A friend of mine works in QA for a shop that 20 years ago dropped out of automotive and went into aerospace. They are a lot happier for it.
  • Lbc_conejo Lbc_conejo on Apr 24, 2009

    @ZoomZoom ...Why do business with them? This is an issue anywhere a market exists with a few buyers and many sellers. The buyer has all of the power and the sellers make less than fair returns until they go out of business or prices rise. Theoretically, suppliers should merge until pricing power becomes more equal. This mess will get far more complicated and costly (especially to the taxpayer) before it's over. Once there's a plan in place for GM and Chrysler, I think we should put a national sales tax in place on all car sales to help pay for this. It would be a lot fairer than for all taxpayers' to foot the bill.

  • CanadaCraig You can just imagine how quickly the tires are going to wear out on a 5,800 lbs AWD 2024 Dodge Charger.
  • Luke42 I tried FSD for a month in December 2022 on my Model Y and wasn’t impressed.The building-blocks were amazing but sum of the all of those amazing parts was about as useful as Honda Sensing in terms of reducing the driver’s workload.I have a list of fixes I need to see in Autopilot before I blow another $200 renting FSD. But I will try it for free for a month.I would love it if FSD v12 lived up to the hype and my mind were changed. But I have no reason to believe I might be wrong at this point, based on the reviews I’ve read so far. [shrug]. I’m sure I’ll have more to say about it once I get to test it.
  • FormerFF We bought three new and one used car last year, so we won't be visiting any showrooms this year unless a meteor hits one of them. Sorry to hear that Mini has terminated the manual transmission, a Mini could be a fun car to drive with a stick.It appears that 2025 is going to see a significant decrease in the number of models that can be had with a stick. The used car we bought is a Mk 7 GTI with a six speed manual, and my younger daughter and I are enjoying it quite a lot. We'll be hanging on to it for many years.
  • Oberkanone Where is the value here? Magna is assembling the vehicles. The IP is not novel. Just buy the IP at bankruptcy stage for next to nothing.
  • Jalop1991 what, no Turbo trim?
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