Government, Automaker Aid Keeps Parts Makers Alive

KEN THOMAS

DETROIT (AP) — Government aid and timely payments by General Motors, Ford and Chrysler have held off the predicted collapse of the nation's auto parts supply base, but industry officials say more bankruptcies are coming as the effects of Detroit's temporary factory closures continue to ripple through the economy.

Hundreds of companies large and small across the country make everything from bolts to axles to transmissions, shipping them to Detroit Three factories as well as those of foreign automakers with U.S. plants.

Some supply parts to makers of larger components, creating a chain of companies that many thought would snap if payments were interrupted to firms already under extreme financial stress because of the U.S. auto sales slump.

While there have been about 20 supplier bankruptcies so far this year, most suppliers have managed to hang on despite Chrysler Group LLC and General Motors Corp. entering bankruptcy protection and shuttering their factories for weeks to keep inventory under control.

"There was not the Armageddon that could have been there," Chip McClure, chairman and CEO of supplier ArvinMeritor Inc., which makes parts for cars and heavy trucks.