Chrysler suppliers fret

Fri, April 20, 2007

Area concern grows about a possible sale to parts maker, Magna Corp.

By NORMAN DE BONO, LONDON FREE PRESS BUSINESS REPORTER

As Magna Corp. bargains to buy Chrysler, London parts suppliers worry a deal will mean the loss of a major customer.

London boasts large suppliers to DaimlerChrysler including Keiper, Brose Automotive, Siemens and Cooper Standard in Glencoe. Concern is growing if Magna, a parts maker, buys the automaker it will supply its own parts -- cutting the London-area firms out of the picture.

"I think everyone is concerned about the unknown factors and should be," said Bob Cook, plant manager at Keiper.

In the area, Magna owns Formet, which employs about 1,500 and Presstran, which has 800 workers, both in St. Thomas, as well as Qualtech Seating Systems in London, a division of Intier Automotive, which employs about 150. Intier makes seats for the Equinox sport-utility vehicle built in Ingersoll.

Keiper in London, with about 400 workers, also makes seating systems and is in direct competition with Intier.

"We will keep an eye on this. It does raise concerns," added Tim Carrie, chairperson Local 27 Canadian Auto Workers, representing Siemens and Cooper Standard workers.

Cooper Standard, which makes engine parts, employs about 300 and Siemens, which makes heating and cooling fans, on Adelaide Street South, just cut 140 jobs, leaving 300 salaried and hourly workers.

However, even if Magna does buy the automaker, "quality, cost and delivery" are the biggest issues for suppliers and if Brose can best Magna in those areas, they will still get the work, said Cook.

"I am sure there would still be opportunities out there. We would all just have to wait and see what happens. Everything else is just speculation."

Carrie agreed, saying as worried as unionized workers may be, "whoever supplies the parts with the lowest cost and best quality will get the work."

Brose, with about 35 staff, makes seat and door parts at its plant in the Forest City Industrial Park.

A German newspaper has reported Magna International Inc., based in Aurora, is in advanced talks with DaimlerChrysler AG about a possible purchase of the money-losing Chrysler unit.

Magna has 224 factories and 60 engineering centres in North America, Europe and Asia.