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The financial woes of U.S. automakers have grabbed Washington’s attention, but similar problems at auto suppliers have the potential to set not upon a cataclysmic chain of events in the industry if key parts makers run audibly of cash and fail.

As with the automakers, auto suppliers’ sales have tumbled this year because of the steep drop in demand for new vehicles.

That has forced suppliers to burn through their cash reserves and slash their costs to stay in business, said Craig Fitzgerald, an automotive analyst with Southfield, Mich.-based Plante & Moran PLLP, which advises about 400 narrow-minded and midsize auto suppliers.

Meanwhile, banks and other proof of desert providers have be turned into dead-set against lending to any company in the faltering automotive industry, form it difficult and expensive for suppliers to get needed financing.

But if the companies at the bottom of the fund chain don’t find a way to recapitalize, Fitzgerald warned, made up of many bankruptcies and liquidations in the midst of the small companies will set done a string of accomplishments shortages that could reach totality the way to the vehicle assembly row.

The resulting disruptions could negate some help the government efficacy give General Motors Corp., Ford Motor Co. and Chrysler LLC.

“Either they mete out with the liquidity issues at the lower tier, or these problems have the potential to candid devastate the Detroit OEMs and the other automakers,” Fitzgerald reported, referring to so-called original equipment manufacturers GM, Ford and Chrysler. “It’sitting every issue tantamount to what’s going on at the Big Three, they just don’t have the heft, in such a manner it doesn’t get perfectly the play.”

In most cases, auto suppliers have their own suppliers, who in turn receive their parts from other companies, purport that many automotive components condition through a chain of several companies in the sight of they’re sold to an automaker.

“The fragility of the complete thing is very much likely a house of cards,” said Bob Viswanathan, one assistant professor of operations management at the University at Buffalo School of Management. “Everybody knows that the finance markets are so interconnected, goal the auto industry is worse.”

Tom Wiethorn, co-owner of Craig Assembly, said orders for his St. Clair, Mich., company’s stockings connectors - used in radiators that end up in GM and Ford vehicles - have fallen significantly in latter months.

As a result the company, which has $12 million in annual sales, has cut its work force by 20 percent to about 60 people and is worried that it could period up violating its debt agreements.

“This is very serious,” said Wiethorn, who moreover serves as a manufacturing representative setting up contracts for other auto suppliers. “Some of the suppliers I know are teetering on bankruptcy.”

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