YOUNGSTOWN, Ohio (WKBN) – The bankruptcy filing and potential closing of a major General Motors supplier could stop production at nearly every North American plant in the coming days.
The Wall Street Journal is reporting that Clark-Cutler-McDermott Co., a supplier that makes insulation and interior trim products for the vehicles, filed for bankruptcy, which could shut down 19 GM assembly plants in North America.
The report says that GM is fighting to take possession of the company’s equipment and inventory to ensure that production will not be stopped.
A spokesman at GM Lordstown issued this statement:
There is a court hearing tomorrow to address the issue and we anticipate no material impact to GM’s supply between now and then.
The Wall Street Journal, however, is quoting a GM court filing that reads:
GM will be required to shut down all of its North American plants and suffer immense, immediate economic damages in the tens of millions of dollars.
The Wall Street Journal says that CCM is blaming the bankruptcy on an unprofitable contract with GM that has drained it of $30,000 a day since 2013, according to the Wall Street Journal.
In responses filed Friday, GM accused the supplier of using the bankruptcy process and its position as a critical parts supplier to protect personal interests rather than honor contracts.