General Motors and Stellantis, two of the biggest automotive manufacturers in the world, have teamed up to help Unique Fabricating, a struggling supplier of multi-material foam, rubber, and plastic components used in noise, vibration and harshness (NVH) management as well as water and air sealing. The Michigan-based company has entered into an Accommodation Agreement with three of its main customers, including General Motors and Stellantis, as well as China’s Yanfeng Automotive Interior Systems. The agreement requires Unique Fabricating to “immediately commence a process for the sale of its business to a qualified buyer, in accordance with fixed milestones, which contemplates completion of the sale process by no later than October 31, 2023.” It also calls for the company to develop a restructuring plan, appoint a chief restructuring consultant, and engage an investment banker.
In exchange for these requirements, the companies will provide Unique Fabricating with up to $15 million to support ongoing operations and prevent supply chain issues. However, this is not an act of charity, as the money will help the supplier stay afloat until a restructuring or sale takes place.
GM’s David Barnas stated that the company is working with several of Unique Fabricating’s other customers and its creditors to allow them to be viable long-term through either a restructuring or sale. He added that GM does not expect any interruption to its supply during this process.
Unique Fabricating has also entered into a Forbearance Agreement, which calls on the company to make good on “interest that is overdue” as well as attorney and advisor fees. This totals $1,228,125 and is owed to Citizens Bank.
Despite not being a household name, Unique Fabricating plays an important role in the automotive industry. The company specializes in producing engine covers, fender stuffers, gas tank pads, glove box liners, and other components used in vehicles. However, the company has been struggling for a while and was $47.7 million in debt as of September 30, 2022.
The collaboration between General Motors and Stellantis is a testament to the importance of supply chain management in the automotive industry. By working together to support a struggling supplier, these companies are ensuring that they can continue to produce high-quality vehicles without any interruptions.
Secondary Headers:
Why General Motors and Stellantis are Joining Forces to Help Unique Fabricating
Unique Fabricating’s Struggles and Debt
The Importance of Supply Chain Management in the Automotive Industry
Collaboration Between Rival Automakers
