January 16, 2009 - Checker Motors, Kalamazoo MI

Checker Motors, 87-Year-Old Auto-Parts Maker, Seeks Bankruptcy

Checker Motors Corp., the auto-parts maker that once produced the iconic Checker Taxi Cab, filed for bankruptcy blaming high labor costs and declining vehicle sales by customers including General Motors Corp.

The 87-year-old company, based in Kalamazoo, Michigan, listed assets of $24.5 million against debt of $21.8 million in Chapter 11 papers filed today in U.S. Bankruptcy Court in Grand Rapids, Michigan. The company said it has 246 employees.

Workers “dedicated their careers to the debtor with an expectation of compensation and working conditions that the debtor can no longer afford and that are no longer supported by the market,” Chief Operating Officer Mark Walburn said in court papers.

At least six partsmakers filed for bankruptcy protection last year as GM and Chrysler LLC sought government loans to stay afloat. The automakers received commitments for a combined $17.4 billion, with GM getting $13.4 billion. The companies must convince Congress by March 31 that they can become viable.

Checker Motors, which plans to reorganize, had 2008 sales of $61.5 million, down from $63.4 million a year earlier, court papers show. The company, with a 72-acre site, does stamping and welding for hood assemblies, rear panels and other parts.

Checker Motors was formed by the 1922 merger of Commonwealth Motors and Markin Automobile Body, according to court papers. In addition to the Checker Taxi, the company previously made trailers for Sears, Roebuck & Co. and the U.S. Army, and an Aerobus for airports, train stations and hotels, according to its Web site.

The case is In re Checker Motors Corp., 1:09-bk-00358, U.S. Bankruptcy Court, Western District of Michigan (Grand Rapids).

Original Story - Bloomberg