Magna wants $600 million from Porsche for canceling a contract
By Andrew C., 27 Aug, 2010. 0 Comments
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Magna International Inc. and Porsche AG are embroiled in a controversy related to a contract cancellation but so far, parties have refused to comment on the issue that Austrian newspaper WirtschaftsBlatt reported last Thursday. Supposedly, Magna is demanding at least 400 million euros ($600 million) in compensation from sports car maker Porsche AG for canceling a contract.
WirtschaftsBlatt quoted an "involved person" as saying that the compensation was for development work already done by Magna, which had been preparing to assemble Porsche's Boxster and Cayman models starting 2012 in its Austrian factory. Porsche, which is in the process of merging with Volkswagen AG, seeks to cancel the deal for Magna to build the cars, Reuters declared.
Last year, Porsche said that it would transfer production of the Cayman and Boxster to Magna Steyr in Graz, Austria, from Finland's Valmet Automotive starting in 2012. According to German press, the cars could be built at the German contract manufacturer Karmann. VW is buying Karmann's coachbuilding operations. [via autonews]
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