National Press Release

NEW YORK, March 20 /PRNewswire/ -- A coalition of automotive suppliers, including representatives from both labor and management, who lobbied the Presidential Task Force on the Auto Industry for assistance for auto parts manufacturers is in support of the program announced by the Obama administration on Thursday. "I heartily endorse the program announced by the Treasury Department to stand behind the accounts receivables owed to the suppliers by the Detroit companies," said Wilbur Ross, Chairman of International Automotive Components Group and organizer of the supplier coalition. "This program will go a long way toward stabilizing manufacturing employment in the 42 states where auto workers are employed."

Auto parts manufacturers are the leading U.S. manufacturing employer, accounting for more than 4 million private industry jobs and 5.5 percent of total U.S. manufacturing jobs, including more than 600,000 direct-employment jobs, 1.97 million indirect jobs in industries from steel to plastics and technical services that support auto parts manufacturing and 1.7 million spin-off jobs supported by spending from direct and indirect employees in auto parts manufacturing. (Source: Motor & Equipment Manufacturers Association)

"We appreciate the quick response to the deepening economic crisis that has crippled the auto industry and think this is an important first step towards helping suppliers and the auto companies they support regain stability," said UAW Vice President Bob King who leads the union's automotive supplier department. "It is critical that we ensure the long-term viability of our domestic auto parts suppliers and auto companies, which are integral to maintaining a strong national economy and a strong national defense.

Automotive parts suppliers provide more than 30,000 individual parts per vehicle and 70% of the value of a car assembled in the U.S. In addition, the automotive parts manufacturing industry accounted for 40 percent of total automotive research and development, spending billions of dollars on the intellectual capital required for the design, testing and engineering of new automotive parts and systems. (Source: Motor & Equipment Manufacturers Association)

The auto companies, domestic and foreign, all use large numbers of common suppliers, so the failure of even one supplier could shut down multiple assembly lines at more than one auto company. Several factors have greatly impacted suppliers and their ability to operate, beginning last year with rapidly escalating commodity prices followed by a sudden and drastic decline in auto sales. Together with delayed payments for parts supplied and a lack of access to credit has caused many critical auto parts manufacturers to teeter on the edge of bankruptcy. "We are delighted that the program will be allocated and administered by the original equipment manufacturers, rather than a newly created government bureaucracy," said Wilbur Ross. "This will assure that the program is effected quickly and will proceed without political interference. It is heartening to see that the Obama Administration is moving so decisively to protect blue collar jobs and to stabilize the overall economy."

SOURCE Wilbur Ross