Delphi Bankruptcy

[Rich Kressly]

Alright. I thought Travis made things crystal clear for people, but perhaps I should clarify.

1. Your ONLY concern right now should be for PEOPLE. Teams, forums, and how this may or may not affect the outside world are secondary.

2. Speculation on what happens to others at BEST belongs in the rumor mill, but in this case, doesn't belong at ALL.

3. This announcement was released yesterday. How on earth could anyone know anything yet, especially when the CEO states that nothing will change right away and that all future changes will be handled in an orderly manner?

4. If there is something for you to learn, you will learn it directly from appropriate sources. Be PATIENT. You may hear nothing at all for months, maybe longer.

5. Please refrain from starting your thoughts with "I bet..." or "I wonder if..." followed by some doomsday scenario. It's thinking like that that sent thousands running to the bank for their money in 1929.

If you've ever come upon two people having a conversation and found the people were talking about you, I'm sure it was at least uncomfortable for you. I consider the people that are potentially affected my friends (notice I use the word "potentially" because I have no clue about any of the inside details, nor will I ask anyone).

Maybe I'm just being grumpy, but I find this kind of rumor-mongering to be distasteful. Every time I face adversity and uncertainty in my life (yes, we all get our turn to go through such things), I find compassionate people, not people who pick at open wounds.

When I think of this announcement I see the faces of my friends and, in some cases, the faces of their children. I wish my friends and their families well during an uncertain time and I offer my support.

Now, if you want to talk and speculate further, BET on this. You will receive a pm from me, asking you to take your conversation to a private arena. I know society in general loves this kind of thing. I also know that FIRST attempts to improve upon and even change the culture for the better. Everyone here is capable of rising above the trappings of popular culture and this situation is no different.

Namaste...

[UlTiMaTeP]

Originally Posted by Adam Richards

This was actually starting to be noticed around Q4 2004 when they had a nice 4 billion dollar income tax cost incurred (thank you government ). They were starting to lose their footing back in Q3, where they incurred losses of $113million, but the income tax really just decimated them. They lost a further $726million in the Q1 and Q2 of this year, making the likelihood of them being able to keep themselves afloat at their current rate very difficult to say the least.

This is truly going to affect the FIRST community in a very bad way in the next few years, and we can only hope that either the affected teams are kept on the budget or that they are able to find sponsors for the 2007 or 2008 season, depending on if/when the cut occurs.

(Data taken from Hoovers.com)

You have been flamed enough for this, but every corp, unless its a chapter S, pays federal and state income tax, its the reason you have roads, and a High School.

[Rich Kressly]

Originally Posted by UlTiMaTeP

You have been flamed enough for this...

Then why is there a need to respond? As stated before, please stick to the intent of the thread.

[Dennis Jenks]

All,
I know nothing first hand of the Delphi situation so I am not going to comment on that here. However I would like to point out that while Delphi Automotive provides most of the financial support to their teams, it is the work of people like Andy Baker, Dr. Joe, Travis and many others that make the Delphi teams what they are. Speaking from a mentor’s point of view, there is no way a company can compensate you for the amount of time it takes to run a FIRST team. These people do what they do because they like helping kids and they believe in the cause, it’s that simple. In my opinion, the future of FIRST does not lie in the hands of corporations, but in the hearts of the mentors and students (future mentors) involved. The Delphi teams may emerge from this unscathed, or they may have to scale back a bit, but I am confident that they will continue to exist. That said, (and again knowing nothing of the situation) I would like to wish Delphi and their employees nothing but the best during this uncertain time.

[Michael Hill]

This is very bad news in Kokomo. Many jobs in the city, and a lot of the city's economy relies on Delphi. If Delphi goes down and Chrysler follows, our city will surly be in an economic crisis. They are the two biggest employers in our city. The only 2 factories I know if in Kokomo...

[Kyle Love]

Originally Posted by Michael Hill

This is very bad news in Kokomo. Many jobs in the city, and a lot of the city's economy relies on Delphi. If Delphi goes down and Chrysler follows, our city will surly be in an economic crisis. They are the two biggest employers in our city. The only 2 factories I know if in Kokomo...

Theres a few more like Haynes and some other small ones...but nothing close to Delphi and Chrysler. But I doubt the plant in Kokomo would close very soon...I have heard it would be THE last one to close...but thats not coming from a person that would control that so I don't know how true that would really be.

[wilshire]

Delphi has filed for bankruptcy. I'm guessing that things like FIRST sponsorships will be among the first items cut from their budget. What will this mean for Delphi sponsored teams?

Notice the original intent was to discuss the bankruptcy of Delphi Automotives and the POSSIBLE cuts to FIRST related funds that they donate every year. Possible economic crisis of kokomo and related teams losing functions should be discussed elsewhere.

[David Kelly]

Originally Posted by Kyle45

Theres a few more like Haynes and some other small ones...but nothing close to Delphi and Chrysler. But I doubt the plant in Kokomo would close very soon...I have heard it would be THE last one to close...but thats not coming from a person that would control that so I don't know how true that would really be.

This filing does not mean that Delphi is going out of business, it just gives them protections and ability to restructure their company.

I am just worried about my friends and family during this uncertain time. It's still very early and we should not speculate on what could happen because only worsens the situation.

Lets keep everyone in our thoughts and hope for the best.

[Alan Anderson]

FIRST sponsorship is probably not going to fall under the category of "day to day activities". Losing team funding is definitely something worth worrying about, but it's not worth worrying about right away. I'm going to wait to see what the first couple of weeks of activity under Chapter 11 brings before I spend much time dwelling on it.

(By the way, Chapter 11 of the Bankruptcy Code deals with reorganization. It isn't a Chapter 7 "liquidation" bankruptcy, it's seeking protection against creditors and lawsuits while it works on a plan to satisfy them and avoid going out of business.)

Originally Posted by Shu Song

That's terrible. I hope that none of the other automotive companies that sponsor FIRST and its teams file for bankruptcy. That would be detrimental to FIRST and I don't even wanna think about what might happen if something like this did happen.

Look at Team 27. C&A had to drop us a short while back. This stuff's been spiraling down for a while. Unfortunately, a lot of us thought that the bottom had already been hit.

[MikeDubreuil]

I just wanted to say to the employees of Delphi... good luck and that I hope there's a good outcome for you. Your generosity in with your time and dollars has been exemplary for the entire FIRST organization.

[bill smith]

This is happening to other teams with big name sponsors Ford Motor told all its teams (16 of them ) in Sept. No Financial funding for this year.

[KenWittlief]

The company has filed for chapter 11. That is not speculation or second guessing, its the reality of the situation.

Read this report: http://news.yahoo.com/s/nm/20051010/...auto_delphi_dc

and then tell us if you think Delphi is going to close plants, lay people off, ask many employees to take a cut in pay, and then continue to make charitable contributions to HS FIRST teams?

Chapter 11 means the company owes money that it cannot repay: suppliers and creditors. Outside agencies become involved in overseeing how every dollar is spent. How can the company tell a supplier or creditor "we owe you money and cant pay it, but we are still going to donate $50k, or $100k, or $500k to these charitable organizations this year" ?

This is a very serious situation for teams sponsored by the company. From my experience, large companies become tight lipped and very cold at times like these, and you wont get any warning that you are losing your funding, or that you are losing your job until the very day it happens.

Its october 10th, we are well into the school year. I would be busy looking for backup funding for this year incase the company is not able to support your team. That way, you are covered no matter what happens. If you take a wait and see approach, and the worse case hits you, its going to be very hard to fund a team on short notice for this years regionals.

[Alan Anderson]

Originally Posted by KenWittlief

Chapter 11 means the company owes money that it cannot repay: suppliers and creditors.

That's not entirely correct. Chapter 7 is all about being unable to pay one's debts. Chapter 11 is basically about getting some breathing room in order to negotiate ways to satisfy all creditors without selling everything and shutting down operations.

It seems that Delphi's main problem has been an inability to manage the operating costs that were inherited in the split from General Motors. This isn't from a lack of trying; many of the costs have been beyond the company's control. The Chapter 11 filing provides a chance to force a solution to some of the previously unresolvable issues.

[Erin Rapacki]

Originally Posted by MikeDubreuil

I just wanted to say to the employees of Delphi... good luck and that I hope there's a good outcome for you. Your generosity in with your time and dollars has been exemplary for the entire FIRST organization.

I agree, and I hope all goes well for the Delphi employees who also serve as FIRST mentors. If this unfortunate situation results in a pink-slip for any FIRST mentor, I hope they feel free to reach out to other mentors with their situation (or vice versa). Another job might be just a phone-call-to-a-FIRST-friend away.