Local companies brace for impact of GM bankruptcy

By Dustin Grove (grove@wsbt.com)

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GM bankruptcy

Local car dealerships are among many preparing for the impact of GM's bankruptcy. (WSBT photo)

By Beth Boehne

Story Created: Jun 1, 2009 at 4:55 PM EST

Story Updated: Jun 3, 2009 at 11:19 AM EST

MISHAWAKA — At Nyloncraft in Mishawaka, business isn’t exactly booming these days.

“It’s not a good time,” said Jim Krzyzewski, President. “We’ve got half our folks laid off.”

And Monday came the news that General Motors, one of the company’s biggest customers, is going bankrupt. Krzyzewski said he was prepared.

“We’re going to have two weeks of shutdowns at this plant (this month) and that’s been part of the plan even before today’s announcement,” he said.

Nyloncraft officials still consider themselves relatively fortunate. They've been able to recoup most of the million dollars GM owed them from GM and a U.S Treasury program designed to help minimize the financial damage. Other suppliers with plants in our area are still waiting.

Bosch is owed $66 million, $27 million is owed to American Axle, and $29-million owed to Johnson Controls. Like Nyloncraft, a spokesperson for Johnson Controls said the company expects all money will be collected from General Motors and the U.S. Treasury program.

To tighten the belt, General Motors also plans on closing thousands more dealerships across the country. And for those dealerships that survive, they might still have a problem — a public relations problem with consumers who are nervous to buy.

“We’re not going to get any parts or labor on the car,” one GM customer said.

But dealerships say that isn’t true.

“We think for the normal customer, it will be pretty much business as usual,” said Matt Helmkamp, President of Gates Chevy World in Mishawaka. Helmkamp said warranties will still be honored, and parts will be available. He said he’s confident in his company’s future.

"We sold 10 vehicles on Saturday so there’s obviously a good contingent of people who believe in General Motors and want to support it now in a time that’s pretty tough in its history.”

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