Federal Mogul Business report FY2008
|Financial Overview||(in million dollars)|
generates over 80% of its revenue outside the United States
and, as a result, the weakening of the U.S. dollar, primarily
against the euro, increased reported sales by $81 million.
-Sales volumes decreased by $48 million due to OE production volume decreases in Europe and North America.
-The November 2007 acquisition of a controlling interest in a joint venture in China contributed additional sales of $20 million.
-Continued customer pricing pressure reduced sales by $22 million.
|Powertain Sealing and Bearings(PTSB)|
|Sales||1,043||1,054||(1.1)||-Approximately 65% of PTSB's
revenues are generated outside the United States and the resulting
foreign currency movements increased sales by $35 million.
-Reduced light vehicle OE production in North America and Europe outweighed increases in market share and OE production volume in Asia, resulting in a net volume decline of $80 million.
-Customer prices were increased by a net $27 million.
-The March 2008 acquisition of FMBIL increased sales by $12 million.
|Vehicle Safety and Protection (VSP)|
|Sales||717||793||(9.6)||-Approximately 80% of VSP's sales
are generated outside the United States where foreign currency
movements, primarily the weakening of the U.S. dollar against
the euro, increased sales by $32 million.
-Sales volumes fell by $104 million as significant market share gains in Asia were more than offset by the decline in light vehicle and OE production in North America and Europe.
-Customer price reductions were $4 million.
Automotive Products group generates about 55% of its revenue
outside the United States and the corresponding impact of exchange
movements increased sales by $12 million.
-New business in all regions, including the North American market, accounted for increased sales of $32 million.
|Sales||2,637||2,679||(1.6%)||-This decrease was due to sales volume decreases of $119 million, partially offset by favorable foreign currency of $37 million and customer price increases of $40 million.|
-The Company is supplying components or systems for nine of Ward's "10 Best Engines" for 2008 model year vehicles. The Company provides a wide range of power-cylinder, sealing and heat insulation components for the award-winning engines, including pistons, rings, liners, bearings, bushings, valve seats, valve guides, cylinder head gaskets, intake and exhaust manifold gaskets, oil pan gaskets and engine wiring heat insulators.The engines that feature Federal-Mogul products are:
-Audi: FSI 2.0L Turbocharged DOHC I-4
-BMW: 3.0L Turbocharged DOHC I-6
-Daimler: 3.0L DOHC V-6 Turbodiesel
-Ford: 4.6L SOHC V-8
-GM: 3.6L DOHC V-6
-GM: 6.0L OHV V-8 Hybrid
-Honda: 3.5L SOHC V-6
-Mazda: DISI 2.3L Turbocharged DOHC I-4
-Nissan: 3.7L DOHC "VQ" V-6
(From a press release on Jan. 16, 2008)
-The Company announced, in September 2008 and December 2008, restructuring actions, called "Restructuring 2009"
-This plan, when combined with other workforce adjustments, is expected to reduce the Company's global workforce by approximately 8,600 positions.
-During 2008, the Company has recorded $127 million in restructuring charges associated with Restructuring 2009, and expects to incur additional restructuring charges up to $37 million through 2010.
-In Oct. 2008, Federal-Mogul System Protection and Federal-Mogul KK, two of Japanese arms of the Company, announced that they will merge into one new company, Federal-Mogul Japan as of December 1, 2008. in order to improve their operational efficiency and business establishment in Japan. (From an article in the Nikkan Jidosha Shimbun on Oct. 16, 2008)
|R&D Expenditure||(in million dollars)|
The Company's research and development activities are conducted at the following locastions:.
-Within the United States, these centers are located in Plymouth, Michigan; Skokie, Illinois; Ann Arbor, Michigan; Exton, Pennsylvania; and Toledo, Ohio.
-Internationally, the Company's research and development centers are located in Burscheid, Germany; Nuremberg, Germany; Wiesbaden, Germany; Bad Camberg, Germany; Chapel, United Kingdom; Crepy, France; and Yokohama, Japan.
-The newest technical center in Shanghai, China is expected to open during the second quarter of 2009.
|Capital Expenditures||(in million dollars)|
|Powertrain Sealing and Bearings||69||65||51|
|Vehicle Safety and Protection||40||45||39|
Investment outside USA
-In Jul. 2008, the Company announced that it started production at its new Powertrain Energy business segment facility in Araras, Brazil. The 10,300-square-meter facility produces pistons, camshafts, and valve seats and guides. The facility was built to accommodate a high-tech piston line and relocation of the operations from a former facility in Araras. A second piston line is expected to be in operation by the end of 2008. (From a press release on Jul 7, 2008)
-In Aug. 2008, the Company announced it is planning to build a new facility in Chennai, India, for the manufacture of friction components for Original Equipment and Aftermarket segments. The operation is scheduled to begin production of light vehicle brake and friction components, commercial vehicle friction products by September 2009. The Company currently manufactures products at six operations in India. (From a press release on Aug 7, 2008)