Chrysler Sues Getrag on the Issue of Plant Financing
Chrysler LLC has filed a lawsuit against Getrag, which is a German parts maker.
The lawsuit has been filed because of the fact that Getrag misrepresented its ability to secure financing in order to build a transmission plant in Tipton, Ind. It was worth $530 million.
Chrysler said in a statement late Wednesday that Getrag and Getrag Transmission Manufacturing LLC failed to use good faith efforts to obtain financing for the joint venture.
The automaker added that it is seeking damages for "wrongful conduct" and a release from reimbursing Getrag’s costs related to the plant.
Randy Cyman, who is the human resources director for the Tipton facility, said Thursday that Getrag had no comment on the lawsuit. He said construction at the plant, which he described as "80 percent complete," was continuing.
Chrysler spokesman David Elshoff said the plant’s future was unknown. He added the reasons behind the lawsuit were unrelated to the recent tightening in the credit markets.
"This suit is a result of breach of contract and fraudulent misrepresentation," Elshoff said. "It is not related to today’s credit issues."
The plant is an integral part of what the automaker calls its "powertrain offensive." The plant was indulged in a $3 billion investment in order to launch new engines as well as fuel-efficient, dual-clutch transmission developed with the German parts maker, Getrag.
It was expected that the facility would employ 1,400 workers : 1,170 would be working at the plant and 230 would be working for other complimentary jobs in the nearby Kokomo.
