Chrysler Sues Insurers for Refusing to Cover Losses the Company Sustained During 2003 Blackout

AUBURN HILLS, Mich. November 21,2004; The AP reported that DaimlerChrysler AG's Chrysler Group has sued insurers for refusing to cover losses the company sustained during the 2003 blackout.

The outage left millions of Michigan residents without power, and idled 14 of Chrysler's 31 North American plants, primarily in southeast Michigan and Ontario. Chrysler said in the lawsuit it suffered $33.1 million in damages as a result, though spokesman Mike Aberlich said the exact figure is still being determined.

The suit against German insurer Allianz AG and its Canadian and California subsidiaries was filed in October in Oakland County, but was moved to federal court on Nov. 12, The Detroit News reported Sunday. The automaker also said it's entitled to 12 percent interest, about $4 million.

Detroit lawyer James R. Case, who represents the insurance company, declined to comment on the case.

The blackout cost Chrysler about 10,000 vehicles and forced it to scrap about 1,000. Many workers at all three Michigan automakers didn't report for work the day after the blackout.

General Motors Corp. closed 19 of its plants and three parts warehouses, affecting 47,000 workers, and Ford Motor Co. shut 23 of its 44 plants in North America.

GM spokeswoman Brenda Rios said the company didn't file an insurance claim related to the blackout and would not estimate the company's losses.

Ford spokeswoman Kathleen Vokes said the company filed no lawsuits related to the blackout, but declined to discuss whether it had filed an insurance claim.

The blackout was the worst in the nation's history, knocking out power to parts of eight states and costing at least $6 billion in economic and other losses.