economy
GM Reaches Up to $4.5 Billion Parts Deal Designed to Avoid Supply Chain Troubles
The deal follows years of global automotive supply chain issues for GM and other companies.
TL;DR
- General Motors has entered into a purchasing facility worth up to $4.5 billion.
- The deal is with Procura Auto Parts, which specializes in sourcing rare or critical components.
- Funding for the facility is provided by a bank syndicate led by JPMorgan Chase and Banco Santander.
- GM will issue irrevocable payment undertakings (IPUs) to repay suppliers after parts are used in production, by July 31, 2029.
- This deal helps GM keep inventory costs off its balance sheet and secures future supply.
- The arrangement follows years of global automotive supply chain issues experienced by GM and other automakers.
- GM declined to specify which parts are being targeted but noted problematic parts include semiconductor chips, rare earths, and wire harnesses.