NUMMI, Toyota Sue "Old GM" For Contract Breaches
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.