Visteon Corp. is asking a U.S. Bankruptcy Court judge to approve up to $33.9 million in payments to critical suppliers for parts they delivered to Visteon before the giant parts suppliers filed for Chapter 11 protection today.
Visteon, the former parts unit of Ford Motor Co., said in a motion today that the $33.9 million is about 28 percent of the $123 million the company owed its production parts suppliers when it entered bankruptcy. When nonproduction suppliers are included, Visteon owes its suppliers about $169 million.
The critical-supplier payments are key to preventing possible parts interruptions and aiding some financially distressed suppliers, Visteon said in the motion, scheduled to be heard tomorrow in Wilmington, Del., as part of first-day pleadings in its bankruptcy case.
Visteon did not identify its critical suppliers, although the company said it had 2,585 production and nonproduction suppliers.
In the motion, Visteon said it wanted to pay about $15.4 million of the prepetition supplier claims on an interim basis. The remainder would be meted out on a final basis.
Visteon, which makes interiors, climate control systems and electronics, has struggled financially along with the rest of the supply chain as North American car and truck production in the first quarter dropped to the lowest levels in 18 years.
Visteon, of suburban Detroit, ranks No. 19 on the Automotive News list of the top 150 North American suppliers, with North American sales to automakers of $2.18 billion in 2008.