Delphi $853M loss puts supplier $5.5B in red for '06

[1931Chevy]

http://www.detnews.com/apps/pbcs.dll...702280344/1148
DETROIT -- Auto parts maker Delphi Corp. said Tuesday its losses widened to $853 million in the fourth quarter and $5.5 billion for all of 2006, partly because of restructuring expenses.

The former parts-making operation of General Motors Corp. had lost $828 million in the fourth quarter of 2005 and it lost $2.4 billion for all of that year.

The company said $3 billion in restructuring costs, mainly expenses related to buyout and early retirement offers to 20,000 unionized hourly workers, were responsible for a big chunk of the losses for the year.

The fourth-quarter loss included $200 million in noncash charges related to its assets, Delphi said in a filing with the U.S. Securities and Exchange Commission.

Chief Financial Officer Robert Dellinger said the net loss for the year would have been the same as the 2005 net loss had it not been for the buyout and early retirement costs.

[asim]

Man they are losing LOTS of money just making PARTS of cars...

[69Firebird400]

They are losing an unbelievable amount of money. At what point do they just throw up their arms and declare Chapter 7? Anyone know when they are supposed to emerge from bankruptcy (which I would imagine depends on GM agreeing to pick up a large portion of the restructuring tab)?

[Xeper]

They are closing alot of plants, and my site is seeing more Delphi parts coming in than usual, with more ahead. And the fact that they just make "parts" adds up to alot when they not only ship to GM, but Ford (all brands + premium), DCX (all brands + premium), Toyota, Honda, And many others brands and locations around the world.

They will eventually pull out of Chapter 7. My understanding was that they were still working things out with the UAW and GM. If they dont and just completely close down, this will hurt alot of Automakers. Of course mainly GM... until they find another supplier.

[69Firebird400]

Originally Posted by Xeper

They are closing alot of plants, and my site is seeing more Delphi parts coming in than usual, with more ahead. And the fact that they just make "parts" adds up to alot when they not only ship to GM, but Ford (all brands + premium), DCX (all brands + premium), Toyota, Honda, And many others brands and locations around the world.

They will eventually pull out of Chapter 7. My understanding was that they were still working things out with the UAW and GM. If they dont and just completely close down, this will hurt alot of Automakers. Of course mainly GM... until they find another supplier.

GM is doing a better job of diversifying their supply sources, but they still bought something like $700 million in parts from Delphi in January alone. I think that was down from $880 million in January 2006, at least. Still, Delphi closing up shop would absolutely doom GM. Probably not going to happen, because it would be a disaster for everyone.

Just a quick aside - Chapter 11 is what they're in now - it's the restructuring type of bankruptcy. Chapter 7 is when they just can't re-open and cease operations, selling off assets and having no company left over in the end.