Seat maker Lear files for bankruptcy

[BeatleBoot]

Source: The Detroit Free Press

Updated at 5:38 p.m.

Southfield-based seat maker Lear Corp. said it filed for bankruptcy early this morning after winning support for its reorganization plan from more of its lenders and bondholders.

Lear’s bankruptcy filing became highly anticipated after the supplier defaulted on a $1.2 billion credit agreement last year, and talks with its lenders continued into the summer. In June, the supplier missed a key interest payment for bondholders, one that it couldn’t make without violating a waiver it received from its lenders on its credit default.

That financial trap reflects the dire situation for suppliers throughout the auto industry that are trying to manage piles of debt racked up during years of easy lending and booming auto production, with today’s reality of tight corporate and consumer credit and weak vehicle demand leading to a fall-off in revenue.

Production, Lear said in court documents filed today, has fallen from 15 million in 2007 in North America to an estimated 8 million this year. Lear said in a securities filing yesterday that it expects revenue to fall 33% to $9.1 billion, in 2009 compared with 2008. Lear’s Treasurer Shari Burgess points out in a court filing that material prices, including the cost of hot rolled steel – rising 48% since 2007 — has made matters worse.

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Read more: http://www.freep.com/article/20090707/BUSINESS01/907070337/Seat+maker+Lear+files+for+bankruptcy

[madrchsod]

1. at least some lear folks will be going back to work this week.

fiat/Chrysler plant in belvedere illinois is starting up tomorrow. if i remember correctly lear has a plant near there.my daughter was recalled where she works. the dept she works in supplies the plant with emission parts.

[POAS]

2. This is a customer of the company I work for.

I'm laid off now for another week, this news doesn't bode well for the future.