Wednesday, March 23, 2011

GM (GM), Chrysler Sue Auto Hauler Allied

A lawsuit filed by General Motors (NYSE:GM) and Chrysler Group against Allied Systems Holding Inc (HAUL.UL) claims the company is holding hostage" over 2,400 new cars and trucks of the companies.

GM said in the complaint, "Defendant is holding hostage 1,704 new GM vehicles, with an estimated value of $46.6 million. It simply has no claim to the vehicles; they are GM's property."

The lawsuit from Chrysler, a separate one from General Motors against Allied, claims it is holding close to 700 of its vehicles.

All this centers around a demand from Allied to General Motors to boost its prices annually at a 3 percent rate to reach 15 percent. Allied also wanted to place limitations on the General Motors right to terminate its contract with the company and other revisions to the contract, according to the lawsuit.

Interestingly, Ford Motor Co (NYSE:F) and Nissan Motor Co Ltd said they are still working with Allied and there has been no interruption in their deliveries.

General Motors was trading at $30.62, falling $0.12, or 0.39 percent, as of 2:09 PM EDT.

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