Toyota Sues GM Over Plant Closure

Dec. 1, 2010
Toyota said GM's Motors Liquidation Co. should pay $73 million for breach of contract over the closure of the New United Motor Manufacturing Inc. (NUMMI) plant.

Toyota Motor said on Dec. 1 that it has filed a lawsuit with a U.S. court for damages against General Motors' bankruptcy estate over the closure of their joint manufacturing plant in California.

The Japanese firm claims GM's Motors Liquidation Company (MLC) should pay $73 million for breach of contract over the closure of the New United Motor Manufacturing Inc. (NUMMI) plant this year, said Toyota spokesman Paul Nolasco.

GM pulled out of the venture last year as it restructured under government-backed bankruptcy protection. Toyota closed the plant earlier this year after reaching a deal with the plant's 4,500 unionized workers.

"We've been discussing how to pay costs of winding down NUMMI for more than a year, but as the U..S court recommended filing a lawsuit, we filed the suit on November 24," said Nolasco.

Toyota sold the factory to Tesla Motors in May as the Japanese automaker bought a $50 million stake in the U.S. electric vehicle maker.

Separately, NUMMI has also filed a suit against MLC, seeking about $360 million in damages stemming from the dissolution of the joint venture, Nolasco said.

MLC, responsible for the discarded assets of the former auto giant, chose "to end its active participation in NUMMI," which "breached MLC's commitments to NUMMI and sounded its death knell," the statement said.

Copyright Agence France-Presse, 2010

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