Canadian Plastics

Delphi Chapter 11 announcement not likely to affect Canada

Auto-parts maker Delphi Corp.'s announcement that it has filed for bankruptcy protection will likely not affect the Canadian automotive market or Canadian suppliers of plastic parts and materials to a...

November 1, 2005   Canadian Plastics



Auto-parts maker Delphi Corp.’s announcement that it has filed for bankruptcy protection will likely not affect the Canadian automotive market or Canadian suppliers of plastic parts and materials to automotive manufacturers in Canada.

The Troy, Mich.-based Delphi is the largest supplier of auto parts in the U.S. Since being spun off from General Motors Corp. in 1999, Delphi has experienced a variety of difficulties, and posted a loss of US$741 million in the first half of 2005. The company employs some 185,000 people worldwide.

The company filed for Chapter 11 protection in the U.S. Bankruptcy Court in New York. The Chapter 11 filing does not affect Delphi subsidiaries outside the U.S.

While the problems at Delphi could mean possible cuts in wages, benefits and jobs in order to help the company reach its stated goal of emerging from bankruptcy in mid-2007, those difficulties will likely not affect Canada or open new opportunities for Canadian companies supplying plastic parts or materials.

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Raymond Datt, president of the Ottawa-based Automotive Industries Association of Canada, said Delphi’s business in Canada is not affected by the bankruptcy, and the company has few employees in Canada.

Datt also does not expect there to be any sudden opportunities for Canadian companies supplying plastic parts and materials to Canadian automakers.

“As far as the replacement business in the after market that we represent, the impact will be very minimal to non-existent,” Datt added. “There will be bumps in the road, but no huge impact [in Canada]. And quite frankly, Delphi has to go through this [bankruptcy] process.”

Cambridge, Ont.-based ATS Automation Tooling Systems Inc., a designer and producer of turn-key automated manufacturing and test systems, said in a release it expects Delphi will continue to be an important customer of ATS.

ATS reported that is has some US$10 million in current order backlog with various Delphi divisions and ATS will work closely with Delphi to help it through its reorganization.


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