Chrysler isn’t stopping with diesel-engine maker Cummins as the company leverages its time in bankruptcy court to modify its pickup truck powertrain obligations. Last month, attorneys for General Motors filed documents with the court seeking full payment for development and production costs related to the Two-Mode Hybrid powertrain that Chrysler co-developed with GM and other partners. GM is Chrysler’s Two-Mode transmission supplier for the upcoming 2010 Dodge Ram 1500 Hybrid.
GM’s documents say Chrysler has promised $173,477 to settle $531,275 in costs associated with: open receivables, payments for 2008 manufacturing costs, tooling, pre-production transmissions for the Chrysler Aspen and Dodge Durango Two-Mode Hybrid SUVs (which were killed after only two months of production), and supply agreements. The documents also state that Chrysler has assigned all production-related contracts to Old Chrysler.
Under Chapter 11, Chrysler's assets and liabilities were assigned to two entities: Old Chrysler and New Chrysler. Italian automaker Fiat, which recently merged with New Chrysler after that portion of the company emerged from bankruptcy, hasn’t (yet) assumed the Two-Mode Hybrid contract, leaving it with Old Chrysler.
“We can’t comment about this matter," GM hybrid powertrain spokesman Brian Corbett told PickupTrucks.com. "We don’t comment on pending litigation.”
A source outside Chrysler told TheDetroitBureau.com and PickupTrucks.com that Chrysler is hoping to renegotiate many of its pre-bankruptcy production contracts so they can be signed by New Chrysler under more favorable terms. The Two-Mode Hybrid deal is one of those.
Last week, Chrysler voided its contract with Cummins to produce the light-duty diesel engine for the Ram 1500 as part of Chrysler's Chapter 11 debt restructuring. A Cummins spokesman said he expects the contract to be restarted under the New Chrysler.
However, unlike the Ram 1500 light-duty diesel, about which Chrysler spokesman Bryan Zvibleman ambiguously said the company would "continue to explore all types of propulsion options,” Zvibleman told PickupTrucks.com the company is still planning to "bring a Two-Mode Hybrid Dodge Ram 1500 to market next year.”