STOCKHOLM (AP) -- Swedish auto industry supplier Plastal Holding AB said Thursday it has been forced to file for bankruptcy due to the sharp decline in demand in the carmaking industry.
The company said it has been hurt by reductions in its customers' production volumes, as well as by problems in the credit market, which has made it impossible to finance customer debt.
Plastal spokesman Tunde Oyedeji declined to give further details about the cause of the bankruptcy or whether outstanding payments from carmakers were part of the problem.
The company -- owned by Swedish private equity firm Nordic capital -- supplies engineered plastics to the automotive industry and reported sales of about euro1.3 billion in 2008. The company has over 6,000 employees in Europe and China, of which 500 are based in Sweden.
"The drop in demand has been both unexpectedly sudden and large toward the end of last year and continued in the beginning of this year. The consequences have been more severe than anyone could have predicted," Plastal board Chairman Curt Germundsson said in a statement.
"Our company is a key supplier to the European automotive industry and this will also create large problems for our customers and suppliers," Chief Executive Roar Isaksen added.
Swedish bank Handelsbanken said it has an exposure to Plastal of 2.1 billion kronor ($229.5 million), but pointed out most of the credits are secured against assets in Sweden and abroad.