Auto Parts Supplier Support Plan Launched Today (AXL, TRW, LEA)

The U.S. Treasury Department said the $5 billion program to support auto suppliers was launched today by Chrysler LLC and General Motors (NYSE: GM).

The programs are open to any receivable created with respect to goods shipped after March 19, 2009 made on qualifying commercial terms. Suppliers interested in participating in the program should contact Chrysler and GM, the Treasury said.

Treasury spokesperson Jenni Engebretsen said, "These efforts, backed by U.S. Treasury resources, will help stabilize the auto supply base and restore credit flows in a critical sector that employs more than 500,000 American workers across the country."

"During this difficult period of restructuring in the auto industry, the Supplier Support program will provide supply companies with access to liquidity and protect good-paying American jobs while giving GM and Chrysler reliable access to the parts they need," Engebretsen added.

A number of auto parts suppliers are higher today on the program launch: American Axle (NYSE: AXL) +13%, Lear Corp. (NYSE: LEA) +6%, ArvinMeritor Inc. (NYSE: ARM) +9%, Johnson Controls Inc. (NYSE: JCI) +2%, TRW Automotive Holdings Corp. (NYSE: TRW) +9%.

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