Windsor moldmakers call for federal and provincial aide
In light of the recent calls for a Canadian bailout for the OEMs and parts manufacturers, the Canadian tool die and...
In light of the recent calls for a Canadian bailout for the OEMs and parts manufacturers, the Canadian tool die and mold (TDM) sector wants its voice heard.
B&B Tool & Mold Ltd. president Matthew Binder has written a letter to Industry Minister Tony Clement and Ontario Economic Development Minister Michael Bryant on behalf of several companies. The letter was published in the Windsor Star this weekend.
“We of the tool, die and mold (TDM) industry, an important and fragile sector in the Canadian automotive sector, believe our industry has an even more gravely urgent case for acceleration of payments,” wrote Binder. “We are not asking for charity. We wish to receive payment for the goods we have already delivered, and we wish to carry on business in a manner befitting the current risk and liquidity environment.”
According to Binder, tool shops are owed more than 45 days worth of sales by OEMs, and often forced to carry six-month worth of sales receipts because of payment terms.
“While waiting up to 24 months from contract award to payment is not the optimum situation for tool sources — going out of business by not accepting these terms was the alternative — it was a reasonable risk when the OEMs were creditworthy and we could obtain accounts receivable insurance,” said Binder.
Windsor’s Tooling & Equipment Capital Solutions has delivered a proposal to both Industry Canada and to the Ontario government that calls for a portion of government loan proceeds to the Detroit Three to be earmarked for tooling that has been “completed and accepted by the Tier 1.”
Additionally, the proposal calls on the governments to ensure that all OEM production tooling is at least substantially paid when the OEM buys off the tooling while government loans are outstanding, and that OEMs are required to immediately reimburse tooling expenditures for cancelled or significantly delayed vehicle launches.
“With the funds directed the way we propose, a hundred or more small- and medium-sized companies from Oshawa to Windsor and beyond would directly benefit,” said Binder. “If tooling for any OEM vehicle program under development is not paid for, the tool, die and mold industry will be delivered a crippling blow. Our proposal significantly mitigates the impact of an event of this nature.”
Binder also encouraged all companies in the TDM sector to visit T&E Capital‘s website to review the proposal, and to contact Clement and Bryant with their concerns.