By Rhoda Miel, Plastics News staff
Detroit, Michigan -- Auto supplier Visteon has entered Chapter 11 protection with the US Bankruptcy Court, joining the rank of parts makers trying to reorganise their operations.
The company has been struggling to restructure its debts outside of bankruptcy, but late on 27 May the company filed with the court to give itself time to "address our capital structure and legacy costs that are not sustainable given the current economic environment", said chairman and ceo Donald Stebbins.
The filing does not affect any operations outside the US. Visteon's plants in the UK filed for insolvency in a separate action in April, and the court-appointed administrators immediately closed all three of the plants in the subsidiary.
Visteon has extensive plastics operations, including injection moulding, blow moulding and thermoforming and makes interior, exterior and functional plastics. The company was spun off from Ford in 2000.
The company has struggled since the start to find its own footing, successfully generating business outside Ford, but never turning a profit. Visteon listed a net loss of $681 million for 2008 on sales of $9500 million.
It listed $5300 million in total debts and $457o million in assets in its filing with the bankruptcy court. Its largest unsecured creditors consist mostly of banks and pension funds, although it owes an estimated $7 million to electronics moulder Jabil Circuit and $1m in trade debt to injection moulder Leon Plastics.
The company expects to receive debtor-in-possession financing from Ford to continue its operations while in bankruptcy.
Stebbins said he expects the company to emerge from bankruptcy after its restructuring with its key product lines intact.