By Dan Shaw, Evansville Courier & Press
Philip Eykamp has seen a number of his customers go bankrupt over the years.
None of them has prepared its suppliers for that hardship so well as General Motors, said Eykamp, the vice president of Mid-States Rubber Products. The company based in Princeton makes rubber parts found under the hoods of many cars and trucks.
Eykamp was just one of many Tri-State suppliers and dealers who said they believe GM will emerge from bankruptcy as a stronger company.
"They now have more new award-winning vehicles than for as long as I can remember," he said.
Eykamp said GM has been careful to keep suppliers informed of its bankruptcy plans. The company has offered assurances about wanting to keep many of them afloat while it makes its way through court.
Orders from GM had fallen off even before the bankruptcy, Eykamp said, as the company cut back its production in response to a declining demand for its products. In court, GM is expected to seek permission to keep paying important suppliers while it seeks to turn itself into a profitable enterprise.
Eykamp thinks the government will work to ensure Mid-States Rubber Products is paid for parts it sells. Even without help, the company may be better suited to weather the bankruptcy than others.
Fortunately for Mid-States Rubber Products, the automobile companies aren't its only customers. Others include makers of appliances and industrial machines.
SABIC Innovative Plastics, based in Mount Vernon is in a similar position. A large portion of its business comes from components used in back lights, door panels, fenders, door handles, instrumental panels and other vehicle parts. But in a bad economy, SABIC can fall back on plastics it makes for other products.
That's not to say it hasn't been spared its share of hardships. SABIC announced in February it would let go of as many as 125 of its nearly 1,300 employees. Shelia Naab, a company spokeswoman, said no further reductions have resulted from the GM and Chrysler bankruptcies.
Local car dealers are likely to learn in coming days whether they can keep selling GM vehicles far into the future, according to Don Moore, the owner of the Don Moore Auto Group in Owensboro, Ky. Because of his membership on the Chevrolet National Dealership Counsel, Moore was invited to listen to a teleconference in which the company elaborated on plans to close a large number of its 6,200 vehicle lots.
Moore said a second round of letters will go to dealers in the next week or so. Some recipients will learn their franchise's ability to sell the company's vehicles will be revoked. For those in that situation, the company is offering to wind down their businesses by October 2010.
Other dealers will be told they can expect to keep selling GM products. Moore thinks his dealerships will fall into the second category.
The market in Owensboro contains about 150,000 customers, and his is the only GM affiliate there. The chief competition comes from Toyota and Honda lots. "If there is Toyota, there will be a Chevy dealer," he said.
David Maxwell, Kenny Kent Chevrolet general manager, also expects to keep selling GM vehicles. Rumors of the impending bankruptcy haven't seemed to scare customers away, and he is hopeful for no worse from the actual thing.
Perhaps Chrysler's fairly easy encounter with Chapter 11 protection has reassured them, he speculated. Whatever the reason, Maxwell plans to keep restocking the store's inventory. "If I could get the new Camaros in here, I would take 20 or 30 of them right now," he said.