Production at General Motors plants in North America could be disrupted as a result of a bankruptcy filing on the part of a long-term supplier.
Clark-Cutler-McDermott Co. filed for Chapter 11 bankruptcy protection on July 7, following a motion by GM to take possession of equipment, tooling and inventory that was used to produce components for the automaker. CCM has sought approval to terminate its contracts with GM and to liquidate its assets.
CCM is GM’s exclusive supplier for a number of parts that are used throughout the automaker’s lineup, including wheelhouse liners and dash, floor, fender and pillar insulators. The Massachusetts-based company has produced materials for GM for 45 years and depends on the manufacturer for 80 percent of its revenue.
If GM is unable to secure possession of CCM assets, its lawyers indicate that the resulting damages would be “incalculable, but clearly likely to be immense,” rendering the automaker unable to deliver vehicles and replacement parts.
A court hearing is scheduled for July 13 to address the issue.
Update: GM gained court approval to access tooling and finished inventory from CCM to avoid disruptions to production.