Businesses have a lot of options to package their products, freebies, or marketing materials. These options include the usual cardboard, corrugated, plastic, set up, or wood boxes. Aside from these, a new option has been created in aluminum boxes. Aside …
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Category Archives: Auto Parts
U.S. Treasury Preparing for Chrysler Bankruptcy
Treasury Preparing for Chrysler Bankruptcy. The UAW announced that a settlement agreement has been reached with Chrysler, Fiat and the U.S. Treasury Department. When Chrysler’s Feb. 17 viability plan was rejected, President Obama gave Chrysler workers and the company a second chance, union officials said. This concessionary agreement, while painful, takes advantage of this opportunity.
The settlement agreement, subject to ratification by UAW members at Chrysler, meets the requirements of U.S. Treasury Department loans to the company. It includes modifications to the union’s 2007 collective bargaining agreement and the Voluntary Employee Beneficiary Association (VEBA) trust.
Peter Morici, an economics professor at the University of Maryland, and keynote speaker at NADCA’s upcoming Metalcasting Government Affairs Conference remarked that the treasury plan could affect the wallets of taxpayers. “The Treasury plan reportedly preempts the bankruptcy judge by guaranteeing worker pensions and retiree health care benefits. Similarly, this sets a dangerous precedent for General Motors and Ford.” Morici stated.
Morici further commented, “Obama’s favoritism toward the union in these negotiations is a clear example of political expediency imposing grave economic costs. Specifically, Chapter 11 makes the potential deal with Fiat to provide small car designs to be built in Chrysler factories much less likely. Hence, the company that emerges from Chapter 11 will be much smaller than the one that would have emerged through the task force’s mediation, because the company that emerges from bankruptcy may not have small cars to make at a time when the market wants them. More of Chrysler’s car assembly plants will be permanently shuttered.”
Kinetic Die Casting utilizes die casting to manufacture parts like aluminum car parts, airplane parts, lighting parts and much, much more. If you would like to request a quote, please visit our website:Die Casting quote
Cash for Clunkers helps Automakers
DETROIT (Aug. 6, 11 p.m. ET) — Auto suppliers are ramping up production in line with automakers’ push to rebuild dealership inventories that have been depleted by widespread production shutdowns this summer and the cash-for-clunkers program.
Increased minivan production at the Chrysler Group to restock dealership lots and higher production of General Motors Co.’s GMT900 full-sized pickup platform is driving production increases at the U.S. plants of International Automotive Components Group North America, said John Smail Jr., IAC’s vice president of commercial operations .
Two or three weeks ago, “close to 80 or 85 percent” of IAC’s North American factories were shut down in some form, Smail said. “Most of our facilities are coming back to at least one shift, sometimes two shifts,” he said.
IAC supplies instrument panels, cockpits, door panels, flooring and acoustics.
Smail said cash for clunkers is also driving demand.
Samir Salman, CEO of the NAFTA region for Continental AG, says demand in North America is 10 to 20 percent higher across all company product lines compared with production levels before Chrysler’s bankruptcy, but the cash-for-clunkers program is only one factor driving the increases.
“One fact that we shouldn’t forget is that Chrysler was for roughly two months in bankruptcy where they idled all their production. And we had massive shutdowns from GM,” Salman said.
The depleted dealership inventories combined with cash for clunkers are increasing demand more quickly than would have happened normally.
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Marathon Automotive Group sold to Revstone
Marathon Automotive Group acquired SPX’s Contech Division (die casting) in 2007 for $146 million. It has since filed for bankruptcy. The PBGC has agreed to accept the pension plan and Marathon wants to sell the company to Revstone Industries, LLC., for $14 million and assumption of unspecified liabilities. The fly in the ointment? Ford Motor Co., Automotive Components Holdings LLC, BMW AG and Delphi filed a joint objection to the sale.
From the Detroit News, Tuesday, May 26, 2009:
PBGC to take over auto supplier Contech’s pension plan
David Shepardson / Detroit News Washington Bureau
Washington — The Pension Benefit Guaranty Corporation said Tuesday it will assume responsibility for a bankrupt Michigan auto supplier’s underfunded pension plan.
The government’s pension insurer will take over Portage-based Contech US LLC’s pension plan covering 532 workers and retirees effective immediately, the agency said in a statement.
According to PBGC estimates, the Contech US LLC Pension Plan is 38 percent funded, with assets of $8.4 million to cover benefit liabilities of $22 million. The agency expects to cover $12 million of the $13.6 million shortfall.
Contech LLC sought bankruptcy protection in January in Detroit after it had been acquired in 2007 by investment firm Marathon Asset Management LLC. It has nine U.S. plants, with its Walled Lake plant responsible for much of its revenue.
“This action is an integral part of our ongoing efforts to restructure Contech and meet the challenges of the automotive industry going forward. We continue to work closely with our lenders and customers to reach a consensus on the remaining changes that are necessary,” said Morris Rowlett, chairman & CEO of Contech in a statement in January when the company sought bankruptcy protection.
The PBGC will take over the assets and use insurance funds to pay guaranteed benefits earned under the plan, which ends Tuesday.
Retirees and beneficiaries will continue to receive monthly benefit checks without interruption, and future participants will receive their pensions when they are eligible to retire, the PBGC said.
Within the next several weeks, the PBGC will send notification letters to all participants in the Contech plan detailing the change.
Privately held Contech was founded in 1950 and builds light metal die casting and machining for automobile and parts manufacturers.
The company was sold from former owner SPX Corp. to Marathon Asset Management, a private equity firm, in 2007. Contech’s U.K. subsidiary based in Wales is not in bankruptcy.
Contech has six casting facilities in Michigan, Indiana and Tennessee, and had sales of $312 million in 2007, but saw sales fall to $223 million in 2008 as auto sales plummeted.
Marathon has sought to use Section 363 of the bankruptcy code to sell nearly all of Contech’s casting assets to Revstone Industries LLC.
Revstone would pay $14 million and assume certain liabilities from its casting facilities under the proposed sale.
Last week, several major customers of Contech filed an objection to the sale.
Ford Motor Co., Automotive Components Holdings LLC, BMW AG and Delphi filed a joint objection to the sale. Ford and Delphi both have said they won’t accept Revstone as a replacement supplier.
dshepardson@detnews.com (202) 662-8735
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Revstone to Purchase Auto Parts Suppliers
For some auto parts suppliers, the end of the rocky road of the past couple years may be over as a few sell off assets.
Intermet Corp., which filed for Chapter 11 on Aug. 12, may finally return to smooth pavement. The Fort Worth auto parts maker held an auction on Monday where Revstone Industries LLC, a privately held company based in Paris, Ky., was the winning bidder. (The Deal Pipeline subscribers can read more here.)
This was second bankruptcy filing since Sept. 29, 2004, for Intermet. Interestingly, the Intermet deal was Revstone’s second distressed acquisition of late. In May, it purchased six plants from bankrupt auto parts maker Contech LLC. (The Deal Pipeline subscribers can read about the Contech deal here.)
In other news, publicly traded ArvinMeritor Inc. (NYSE:ARM) overcame a year-long sale process, announcing Thursday an agreement to sell its stakes in two light-vehicle businesses that have been on the block since October 2008.
The Troy, Mich., company agreed to offload its 57% stake in a vehicle suspension unit to joint venture partner Mitsubishi Steel Manufacturing Co., along with a 51% stake in Gabriel de Venezuela, which manufactures parts for countries throughout South America. The two businesses made up around 45% of the company’s 2008 chassis sales.
Values for the light-vehicle businesses were not disclosed, but any progress that suppliers make in this volatile sector does hold some weight. Alan Baum, an analyst at the Planning Edge Inc. in Birmingham, Mich., said divesting these particular units adjusts ArvinMeritor’s focus back to its core, even though they were small pieces of the overall operation.
But good things don’t always come to those who wait.
Fellow auto parts maker Lear Corp. (NYSE:LEA) has been exploring ways to restructure its debt out of court. However, debtholders are now bracing for a bankruptcy filing as soon as this week. The Southfield, Mich.-based company is in breach of debt covenants with its largest lenders. (The Deal Pipeline subscribers can read more about Lear’s potential bankruptcy here.) – Anthony Noto
Kinetic Die Casting manufactures custom metal parts to their customer. If you would like more information about Kinetic Die Casting, please visit our website:Kinetic Die Casting Company
Tier 1 Auto Suppliers Bought by Revstone LLC, Ford, BMW, Delphi Object
Quote, originally posted by Detroit News »
Washington — The Pension Benefit Guaranty Corporation said Tuesday it will assume responsibility for a bankrupt Michigan auto supplier’s underfunded pension plan.
The government’s pension insurer will take over Portage-based Contech US LLC’s pension plan covering 532 workers and retirees effective immediately, the agency said in a statement.
According to PBGC estimates, the Contech US LLC Pension Plan is 38 percent funded, with assets of $8.4 million to cover benefit liabilities of $22 million. The agency expects to cover $12 million of the $13.6 million shortfall.
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Contech LLC sought bankruptcy protection in January in Detroit after it had been acquired in 2007 by investment firm Marathon Asset Management LLC. It has nine U.S. plants, with its Walled Lake plant responsible for much of its revenue.
“This action is an integral part of our ongoing efforts to restructure Contech and meet the challenges of the automotive industry going forward. We continue to work closely with our lenders and customers to reach a consensus on the remaining changes that are necessary,” said Morris Rowlett, chairman & CEO of Contech in a statement in January when the company sought bankruptcy protection.
The PBGC will take over the assets and use insurance funds to pay guaranteed benefits earned under the plan, which ends Tuesday.
Retirees and beneficiaries will continue to receive monthly benefit checks without interruption, and future participants will receive their pensions when they are eligible to retire, the PBGC said.
Within the next several weeks, the PBGC will send notification letters to all participants in the Contech plan detailing the change.
Privately held Contech was founded in 1950 and builds light metal die casting and machining for automobile and parts manufacturers.
The company was sold from former owner SPX Corp. to Marathon Asset Management, a private equity firm, in 2007. Contech’s U.K. subsidiary based in Wales is not in bankruptcy.
Contech has six casting facilities in Michigan, Indiana and Tennessee, and had sales of $312 million in 2007, but saw sales fall to $223 million in 2008 as auto sales plummeted.
Marathon has sought to use Section 363 of the bankruptcy code to sell nearly all of Contech’s casting assets to Revstone Industries LLC.
Revstone would pay $14 million and assume certain liabilities from its casting facilities under the proposed sale.
Last week, several major customers of Contech filed an objection to the sale.
Ford Motor Co., Automotive Components Holdings LLC, BMW AG and Delphi filed a joint objection to the sale. Ford and Delphi both have said they won’t accept Revstone as a replacement supplier.
Kinetic Die Casting manufactures custom metal parts to their customer. If you would like more information about Kinetic Die Casting, please visit our website:Kinetic Die Casting Company
