Metaldyne Corporation Business report FY2007
Business Highlights
Contracts
From January 2004 through March 2008, the Company received approximately
240 new business awards that support future product programs beginning
from 2004 through 2011. The awards extend for up to 10 years, and include
metal-formed components, assemblies and modules for OEMs and Tier I customers'
chassis, driveline and engine applications. As of March 30, 2008, in addition
to programs already in production, the Company's forecasted cumulative
revenue in 2011 is approximately $402 million of awarded programs and
approximately $309 million of programs the Company has identified as highly
probable of being awarded but for which it has not yet received a firm
purchase order.
In February 2007, the Company announced it has been awarded a $70 million
contract from a global automaker to supply chassis products for multiple
2007-2008 model-year car and truck platforms. The first program is currently
in production in the United States; the second begins production in Mexico
later in 2007; and, a third launches in China in 2008. Metaldyne will
supply front and rear knuckle assemblies and front lower control arm assemblies
that reduce cost, weight and complexity, and improve noise, vibration
and harshness (NVH).
In May 2007, the Company announced it has been awarded a multi-year contract
from Chrysler Group to supply environmentally - friendly exhaust manifolds
for future vehicle platforms. Metaldyne will supply fabricated exhaust
manifolds that will help reduce emissions allowing Chrysler Group to meet
PZEV (Partial Zero Emissions Vehicle) requirements for states that follow
California's emission standards. The unique single-wall design is comprised
of a very large chamber that allows the exhaust gases to mix faster, and
increase the operating temperature of the catalytic converter sooner. (From a press release on May 17, 2007)
In February 2008, the Company announced it has won a contract
to supply key powertrain and chassis components to support a future vehicle
produced by China's Chery Automobile Co., Ltd. This business win follows
the official opening of Metaldyne's first manufacturing facility in Suzhou
in 2007. Chery has embraced this opportunity to develop key vehicle components
with Metaldyne including suspension components, oil pumps and powdered
metal forged connecting rods. (From a press release on Feb. 5, 2008)
Divestitures
In May 2007, the Company announced plans to discontinue operations at
its chassis facility in Greenville, N.C. The transaction plan, which is
expected to be completed in December 2007, will result in the closing
of the Greenville facility. The facility currently has 69 employees. Metaldyne
stated that recent production cuts at some of Metaldyne's North American
customers led to this decision. Current manufacturing production lines
will be transferred to its chassis facility in Greensboro, N.C.
In May 2007, the Company announced it will close its Farmington
Hills, Mich., plant by April 2008 to adjust for the excess capacity in
its plants caused by production cuts from its North American customers.
The facility has 170 employees and produces chassis and powertrain products
for several customers. These products will be moved to other Metaldyne
facilities. (From a press release on May 2, 2007)
R&D
R&D expenditure totaled approximately $24.4 million in FY2007 (ended March 2008).
Investment Activities
in thousand dollars | Year Ended Mar.30, 2008 | 81
Days Ended Apr. 1, 2007 |
10
Days Ended Jan 10, 2007 |
Year
Ended Dec.31, 2006 |
Year Ended Jan. 1, 2006 |
Post Acquisition Basis |
Pre Acquisition Basis | ||||
Chassis | 41,095 | 6,789 | 534 | 44,861 | 69,070 |
Powertrain | 28,729 | 5,322 |
344 | 30,338 | 42,029 |
Corporate | 578 | 244 |
- | 786 | 648 |
Total | 70,402 | 12,355 |
878 | 75,985 | 111,747 |
Capital expenditures in fiscal year ending
March 30, 2009 are expected to be in the range of $50-60 million, lower
than prior years when significant capital was spent to transform the
business to new technologies, automation and to expand geographically.
Overseas Investment
In June 2007, the Company officially opened its plant in Suzhou, China,
marking the first operation for the company in that country. The Company
invested $10 million in the project and expects revenues of more than
$100 million when the plant reaches full capacity in a few years. With
the Company's expected growth in China, the Company will make a decision
on a second plant by the end of 2007. Located 46 miles (75 kilometers)
northwest of Shanghai, the 92,000-sq.-ft. (8547-sq.-m.) plant will manufacture
crankshaft damper assemblies, knuckle and control arm assemblies, aluminum
diecast valve bodies and powder metal products. Current OEM customers
include Beijing Benz DaimlerChrysler, Chery, Dongfeng-Peugeot-Citroen,
Shanghai General Motors and Soueast (pronounced Southeast) Motors. The
facility currently has 54 employees and is expected to grow to 97 by
the end of 2007. At full capacity it will employ 350-400 people.