BREAKING: Visteon reportedly files for Chapter 11 bankruptcy
by Chris Paukert on May 28th 2009 at 9:28AM 
According to Automotive News, Visteon Corp. has filed for Chapter 11 bankruptcy protection. The Michigan-based tier-1 supplier was spun off from the Ford Motor Company back in 2000, and it has struggled ever since. The filing took place in a Delaware courtroom, where the company has listed total assets of $4.58 billion and total debt of $5.3 million.
Visteon's struggles have been well documented, with its ballooning debt, falling sales (down by more than 50% in the first quarter of 2009 alone) resulting in a $681 million dollar loss last year. In fact, back in 2005, Visteon had to ask Ford to step in as part of an agreement that saw the Blue Oval agree to take ownership of all of the supplier's hourly employees who were United Auto Workers members, as well as most of the company's North American facilities.
Despite no longer technically being part of Ford, the Blue Oval is still Visteon's largest customer (accounting for around 31% of its sales last quarter), and according to AN, Visteon says that Ford is still committed to help the company with debtor-in-possession financing and future parts orders while the supplier undergoes restructuring.
[Source: Automotive News (subs. req.)| Image: Jonathan Ferrey/Getty]
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Reader Comments (Page 1 of 1)
dukeisduke 9:37AM (5/28/2009)
According to the AP, they have $4.56b in assets, and $3.96b in liabilities:
http://finance.yahoo.com/news/Visteon-files-for-Chapter-11-apf-15367150.html?sec=topStories&pos=8&asset=&ccode=
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Kumar 11:12AM (5/28/2009)
Yeah, the 5.3 million needs to add a couple zeros. I think it's probably supposed to be 5.3 billion, like in a few of the other articles on the interwebs.
Todd 9:42AM (5/28/2009)
First domino in a looooooong string to come, post GM bankruptcy.
Where is Ford going to get parts from once every domestic supplier is out of business? Europe? China?
New business opportunity for VW, Toyota and Fiat - making parts for Ford
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mapoftazifosho 9:43AM (5/28/2009)
What are you talking about?
spookthehamster 10:52AM (5/28/2009)
I nearly got a job with them a year ago, glad I went into F1 instead now.
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DesiAuto 10:53AM (5/28/2009)
Can Ford buy them? If they can, they should.
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jamie 11:19AM (5/28/2009)
Ford used to own Visteon. It was rather a dumb move to sell it in the first place. GM made the same mistake with Delphi. Now even GM is buying back the old facilities.
In 2005, Visteon and Ford reached an agreement whereby 17 of the least profitable Visteon plants and 6 offices would be transferred to an independent business entity called Automotive Components Holdings. 18,000 hourly workers and 5000 salaried workers were transferred to ACH, reducing Visteon to approximately 52,000 employees worldwide and $11 billion in annual sales. Three of the plants are in Mexico, the remaining plants and six offices are part of ACH, managed by Ford, which was referred to as a "temporary entity" whose purpose was to prepare the facilities for sale. By the end of 2007, all ACH operations had been closed, scheduled for closure, merged at least partially, or sold (two back to Ford), with transactions to be completed by the end of 2008 except for one plant which is to remain an ACH facility until its closure in 2009.
Richard S. 11:33AM (5/28/2009)
Ford and GM wanted to divest of Visteon and Delphi respectively in the name of running a "leaner more efficient operation". They were trying to emulate Chrysler who outsourced most of its components and in theory could shop around for lower costs.
It is true that Visteon and Delphi were copies of Ford and GM in that they were bloated with expensive UAW workers under crazy job rules.
However in hindsight we see that Toyota who owns or co-owns many of its suppliers, used this as an advantage by securing reliable and quality parts and even sharing on the profit made by selling to other automakers.
The issue is not to outsource your parts or not, the issue is how you manage either system.
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Champcar 7:20PM (5/28/2009)
Nice PIC!! Bring back the handford
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