Plastic Omnium S.A. Business Report FY2006
|(in million euros)||FY2006||FY2005||Rate of change||Remarks|
See Item (1) below.
See Item (2) below.
|Plastic Omnium Auto Exterior||Revenue
|Inergy Automotive Systems||Revenue
(1) In 2006, Compagnie Plastic Omnium's consolidated revenue rose 13.2% and 3.5% at constant
exchange rates and scope of consolidation. Following the creation in July 2004 of HBPO, a 33%-owned company, engaging
in automotive front-end modules with 2006 revenue of 566 million Euro, Plastic Omnium strengthened its exterior module
strategy in 2006 by acquiring additional shares in Inoplast, giving it a majority stake. A major player in the market
for rear hatchbacks made of composite materials, Inoplast added 217 million Euro to 2006 consolidated revenue.
(2) The Automotive businesses continued to outperform the global automobile market. In line with the commitment to competing in emerging markets, the Company focused its business activities into Asia as a top priority. The percentage of revenue generated in Asia increased from 2% in 2001 to 5% in 2006 and is expected to continue to grow in the year ahead. In 2006, Asian carmakers accounted for 8% of the Plastic Omnium revenue.
Highlights by business unit
Plastic Omnium Auto Exterior
The year of the fender module
In November 2006, Plastic Omnium produced the world's first fender module, which integrates seven different automotive functions. It was designed to meet carmaker demand for pre-assembled, easy-to-mount modules that enhance pedestrian protection and perceived quality while reducing overall vehicle weight. The fender module was a standard feature on the new BMW X5.
Successfully meeting three manufacturing challenges
The year saw a total of 22 production launches, including three in start-up plants: front bumpers for the restyled Renault Scenic in Ruitz, France; the fender module and front and rear bumpers for the new BMW X5 at the Anderson and Duncan plants in the United States; and front and rear bumpers for General Motors' GMT 900 program in Silao, Mexico. In 2006, Plastic Omnium Auto Exterior also filled its first order from Hyundai, delivering exterior components to the carmaker's plant in Montgomery, Alabama. As part of the project to renew the manufacturing base in France, the Ruitz plant will take over all production from the neighboring Bruay-la-Buissiere facility, which will be closed at the end of 2007.
Strong growth at HBPO
HBPO enjoyed a year of sustained growth with seven production start-ups. The company reported revenue of 570 million Euro in 2006. Its UK plant in Banbury produces the front-end module for the new BMW Mini, which integrates a structural front-end system supplied by Plastic Omnium.
A major strategic development in the modular approach
During the year, Plastic Omnium increased its stake in Inoplast to 84%. Inoplast is Europe's leading producer of auto parts and modules made of fiberglass-reinforced polyester and other composite materials. Two-thirds of its revenue is generated by hatchbacks, floor modules, fender structures and trunk lids produced for carmakers, with the remaining one-third coming from radiator grills, fascia, fenders, doors and large body-collar, self-supporting parts produced for Volvo Truck, DaimlerChrysler, Scania and other truck manufacturers.
MAJOR 2006 PRODUCTION START-UPS
- Front bumpers for the Peugeot 207
- Front bumpers and fenders for the restyled Peugeot 307
- Front bumpers and trunk lid for the Peugeot 407 Coupe
- Hatchback for the Peugeot Expert
- Front bumpers for the restyled Renault Scenic
- Fender bracket for the Renault Clio III
- Exterior components for the Volvo S80
- Hatchback for the Volvo XC 90
- Structural front-end system for the BMW Mini
- Structural front-end system for the Audi Q7
- Front and rear bumpers for the Porsche Cayenne and Volkswagen Touareg
- Front and rear bumpers for the Opel Corsa
- Front and rear bumpers for the Nissan Cabstar
- Fender module and front and rear bumpers for the BMW X5
- Front and rear bumpers for the Saturn Sky
- Front and rear bumpers for the Chevrolet Avalanche
- Exterior components for the Hyundai Santa Fe
<HBPO : Front-end modules>
- BMW Mini
- Ford Lincoln
- Skoda Fabia
- Restyled Hyundai Terracan
- Kia Cerato
- Porsche Cayenne and Volkswagen Touareg
Inergy Automotive Systems
Developing expertise for a clean diesel engine
Inergy Automotive Systems is also a source of solutions in the area of pollution-control. In addition to the PZEV fuel tank, the capless filler system, twin sheet blow molding technology and other emissions-reduction solutions that meet the strictest pollution-control standards, the product portfolio has been extended with the Smart Additive System (INSASTM) and DINOXTM, two major innovations that help to reduce diesel engine particulate and nitrous oxide emissions.
Launching operations in China
As part of its strategic commitment to establishing a position in China, Inergy is building its first plant in the market. The site chosen is in Wuhan, Hubei province, ideally situated in the heart of one of China's major automotive manufacturing regions. Scheduled to come on stream in second-half 2007, the plant will initially produce fuel tanks for the Dongfeng-Nissan assembly plant in Xiangfan. The new plant will extend Inergy's production and technical resources in Asia, where it already has operations in Japan, Thailand and South Korea.
Further reorganization of manufacturing resources in Europe
During the year, Inergy continued to renew its European production base. In the United Kingdom, blow-molding operations at the Telford plant were terminated, while in Spain, the Valladolid plant was closed and the Vigo plant was modernized.
MAJOR 2006 PRODUCTION START-UPS
- Citroen C4 Picasso
- Peugeot 207
- New Peugeot Partner
- BMW 3-Series Coupe and Cabriolet
- Audi Q7
- Porsche 997 C4
- Opel Corsa
<NORTH AND SOUTH AMERICA>
- New Yukon Suburban
- Saturn Outlook, Buick Enclave and GMC Acadia
- Buick Lucerne (PZEV fuel tank)
- Buick Lacrosse/Allure (PZEV fuel tank)
- Nissan Altima (LEV 2 and PZEV fuel tanks)
- Renault Megane
- Saturne Daewoo
- Nissan Tiida
In early 2007, automobile production in France and production by US carmakers in North America continues to decline. In this unfavorable market environment, Plastic Omnium's first-half 2007 results will show a decline, but given current backlog, the Company already forecasts a late-year recovery that will accelerate in 2008.
In 2007, Plastic Omnium will continue to expand the Automotive businesses in fast-growing countries.
-In China, one of the Company's priority growth markets:
(a) Inergy Automotive Systems is building a fuel system plant in Wuhan Province.
(b) On 1 March 2007, Plastic Omnium Auto Exterior signed an agreement with SAIC subsidiary Yanfeng Visteon to create a joint company, called YFPO, which will consolidate Yanfeng Visteon's exterior components operations.
-In Argentina, Plastic Omnium Auto Exterior is building a plant to fill an order, beginning in 2008, from PSA Peugeot Citroen.
-New plant projects are under consideration in Poland, India, Iran and Russia.
-In 2006, research and development allocation totaled 105 million Euro or 4.5% of consolidated revenue, (82 million Euros in 2005).
-There were 900 engineers and technicians and they were employed worldwide in 9 R&D centers and in 24 engineering centers in Europe, North America and Asia.
-The Company has a total of 565 patents, of which 89 were filed in 2006.
R&D Highlights in 2006
-In February 2006, Plastic Omnium signed a partnership agreement with PSA Peugeot Citroen in view of implementing a joint technological Innovation Plan to drive shared improvements in perceived quality, safety, comfort and weight reduction. While leveraging the Company's expertise in exterior plastic components, the plan is also aligned with the requirements of the new concepts being developed by PSA. As such, it is particularly focused on opening modules, roof modules, fenders, front ends and fascia.
-In April 2006, Plastic Omnium signed a technological partnership agreement with Webasto. The goal of the partnership is to provide carmakers with complete hatchback and roof modules by pooling the technological capabilities and expertise in plastic solutions and modular architecture of Plastic Omnium Auto Exterior and Inoplast, and Webasto's system expertise in integrating kinematics, electronics and drives for roof and body modules.
|in million Euros||FY2006||FY2005|
-In January 2007, the Company's offer was approved by Commercial Court in Evreux to acquire a plant in Vernon, belonging to Cadence Innovation. The plant currently produces bumpers for the Citroen C2 and C3, Peugeot 1007 and Renault Twingo. With the support of PSA Peugeot Citroen, which has commited to maintaining its order volumes over the medium term, the acquisition will strengthen Plastic Omnium positions in France.
-In April 2007, Plastic Omnium received the green light from the Chinese government to establish Yanfeng Plastic Omnium Automotive Exterior Systems Co (YFPO). Plastic Omnium said that it would acquire a 49.95% stake in YFPO and consolidate the exterior components business of Yanfeng Visteon, which is a joint venture between Visteon Corp. and Shanghai Automotive Industrial Corp. (SAIC). YFPO is expected to start operations in the later part of 2007 supplying parts to multiple customers from two molding plants located at Shanghai and Chongqing. The plants will collectively employ about 500 people.