Car News

GM Makes Deal to Avoid Major Supplier Disruption

After yesterday's production panic, GM execs are probably feeling much better today, as the automaker has made a deal to avert the looming parts shortage. A spokesperson for GM has said that the company was able to reach a settlement with supplier Clark-Cutler-McDermott that would ensure the supply chain would not be disrupted, at least for now.

Clark-Cutler-McDermott was a longtime supplier for GM, producing nearly 200 pieces of trim and insulation that were used in virtually every vehicle GM built in North America. The company blamed low parts prices from GM as the main reason for their declaring bankruptcy, and they had been having difficulty since 2013. CCM had already tried to stop production last month, but GM was granted a temporary restraining order forcing production to resume.

Today's deal means that GM will get all of CCM's current inventory, for a payment of $2.9 million. GM will also be permitted to remove all of the relevant tooling and have it setup at another plant. There has been no announcement made as to who will be taking over the production, but with low inventory just-in-time production, it will have to happen quickly to prevent a disruption in the near future.