Auto suppliers feel carmakers' pain
By Sharon Silke Carty, USA TODAY Wed May 18, 6:31 AM ET
Automotive supplier Collins & Aikman filed for bankruptcy-court protection Tuesday, evidence that financial troubles at the automakers are having a rapid and dramatic effect on the companies that make car parts. A May 5 decision by Standard & Poor's to downgrade General Motors and Ford Motor to junk bond status had little near-term impact on the carmakers, but automotive suppliers are suddenly facing a cash crunch that could put their very existence at risk.
Collins & Aikman, for one, said last week that the move trimmed its available credit line by $70 million. By seeking bankruptcy court protection, the supplier was able to secure a $300 million debtor-in-possession loan from J.P. Morgan.
1 comment:
C&A Chapter 11
Is this a result of over zelous containment activities. This can be a costly endevour and many containment suppliers like to over bill and extend the containment process.
I wonder????
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