Ford Motor Company and General Motors are in talks to arrange financing that would help First Brands sustain operations while the company is under Chapter 11 protection, people familiar with the matter said. The contemplated agreement would have the automakers advance payment for products they plan to take delivery of from First Brands, providing the supplier with cash to support its restructuring effort.
Sources familiar with the negotiations indicated the talks have intensified over the past several days as the parties work to settle the detailed terms. Those involved said the discussions are moving toward a conclusion, though they cautioned the arrangement is not yet finalized and could still collapse.
The core element under discussion is a prepayment mechanism: Ford and GM would effectively provide liquidity up front by paying for future shipments. That advance would be intended to keep First Brands operating throughout the Chapter 11 process by covering immediate working capital needs tied to production and deliveries.
Negotiators have focused on hammering out contractual details that would govern payment timing, the scope of products covered, and how the arrangement would fit within First Brands' formal restructuring plan. As of now, those specifics remain under negotiation and have not been disclosed by the parties involved.
While the financing concept is aimed at preserving supply continuity and giving First Brands cash to navigate the bankruptcy process, the potential for the talks to break down remains. Sources underscored that, despite indications the discussions are approaching the finish line, no agreement has been signed and outcomes could change.
The negotiations reflect an effort to balance the immediate liquidity needs of a supplier in Chapter 11 with the commercial interests of two major automakers that rely on steady product deliveries. For now, the arrangement remains a proposed financing solution under active discussion rather than a concluded transaction.