GM Sues Bankrupt Supplier to Save Camaro
GM has filed a lawsuit against one if its suppliers, Cadence Innovation, which makes door trim, instrument panels and airbag covers. Cadence filed for bankruptcy protection in August, but decided this month to liquidate instead of trying to sell itself.
GM filed the lawsuit in the U.S. Bankruptcy Court in Delaware, asking the court to grant it access to Cadence’s facilities. According to the General, the Cadence is holding hostage equipment necessary to the timely launch of the upcoming Chevrolet Camaro. Without immediate access to the tooling Cadence is holding, GM says vehicle assembly operations could be interrupted because it does not have enough parts on hand.
“Every one day’s disruption in supply of certain component parts could cause a shutdown of GM assembly operations, disrupting not only GM’s business, but the operations of countless suppliers, dealers, customers and other stakeholders,” GM said in its complaint. The automaker said such a shut down would cost millions of dollars per plant per day.
GM says it had an accommodation agreement with Cadence that requires the supplier to continue manufacturing parts and providing tooling and equipment. We can only hope GM and Cadence can iron things out so the 2010 Chevrolet Camaro launch plays out smoothly – GM (and taxpayers) can’t afford a new fiasco.