11/17/2008

Associated Press

Getrag Transmission Manufacturing LLC said Monday it filed for Chapter 11 bankruptcy protection for its Tipton, Ind., facility after Chrysler LLC pulled out of a financing options agreement and left the plant without a primary customer.

The $530 million facility was being built for the sole purpose of making dual clutch transmissions for Chrysler, so when the automaker terminated the deal last month, the German manufacturer said it was forced to stop its operations in Tipton and cancel the project.

Getrag said the filing, which only involves the Tipton facility and doesn't affect the other Getrag operations in the United States, will allow it to deal with claims related to the project in an orderly and equitable fashion.

The company also said Monday that it filed a countersuit against Chrysler to recover costs related to the project and the reimbursement of expenses incurred by Getrag and its suppliers in connection with the project.

Chrysler had previously sued Getrag, claiming that it misrepresented its ability to secure financing to build the Tipton plant. The automaker said it is seeking damages for "wrongful conduct" and a release from reimbursing Getrag's costs related to the plant.