Tower International, Inc. Business Report FY ended Dec. 2017
Financial Overview |
(in million USD) |
| FY ended Dec. 31, 2017 | FY ended Dec. 31, 2016 | Rate of change (%) | Factors | |
| Net Sales | 1,988.0 | 1,913.6 | 3.9 | 1) |
| Operating Income | 115.3 | 101.0 | 14.2 | - |
Factors
1) Net Sales
-The Company’s sales during the fiscal year ended December 31, 2017 increased by 3.9% over the previous year to USD 1,988.0 million. The increase in sales was due to higher volumes in the Company’s operations in North America, combined with positive foreign currency exchange effects and favorable pricing effects due to higher steel prices in Europe. These gains were partially offset by lower sales volumes in the Company’s operations in Europe.
Restructuring
-As of December 31, 2017, the Company completed the sale of its joint venture in Wuhu, China, which was previously agreed upon in the fourth quarter of 2016. The Company expects to complete the sale of its joint venture in Ningbo, China during the first quarter of 2018.
Recent Developments
-The Company has approximately USD 350 million of new business from 2018 through 2020, primarily from North America. This three-year backlog represents an increase of 20% compared to the previous year’s backlog.
Contracts
| OEM | Model | Product Group |
| North America | ||
| Ford | Econoline | Frame Assembly |
| Explorer | Complex Assembly | |
| Expedition/Lincoln Navigator | Body Structures | |
| F-Series | Frame Assembly & Body Structures | |
| Focus | Body Structures | |
| Taurus/Lincoln MKS | Complex Assembly | |
| Escape | Body Structures & Complex Assembly | |
| Chrysler | Dodge Grand Caravan/Town & Country | Body Structures |
| Jeep Grand Cherokee/Dodge Durango | Body Structures | |
| Jeep Wrangler | Frame Assembly | |
| Jeep Cherokee | Body Structures | |
| Ram Pickup | Body Structures | |
| Nissan | Frontier/Xterra | Body Structures & Frame Assembly |
| NV Series | Frame Assembly | |
| Titan/Armada | Frame Assembly | |
| Altima | Body Structures | |
| Toyota | Camry | Body Structures |
| Corolla | Body Structures | |
| Tacoma | Body Structures | |
| Tundra | Body Structures | |
| Europe | ||
| Volvo | V40 | Complex Assembly |
| XC60 | Body Structures | |
| VW | Touareg/Audi Q7 | Body Structures & Complex Assembly |
| Caddy Van | Body Structures | |
| Up!/Seat Mii/Skoda Citigo | Body Structures | |
| Skoda Octavia | Body Structures | |
| Skoda Superb | Body Structures | |
| Skoda Fabia | Body Structures | |
| Seat Ateca | Body Structures | |
| Skoda Kodiaq | Body Structures | |
| Touran | Body Structures | |
| Porsche | Macan | Body Structures |
| Cayenne | Body Structures & Complex Assembly | |
| BMW | 1 Series/3 Series | Body Structures |
| Daimler | Mercedes-Benz Sprinter | Body Structures & Complex Assembly |
| Fiat | 500 | Body Structures |
| 500X | Body Structures | |
| Ducato | Body Structures | |
| Punto | Body Structures | |
| Jeep Renegade | Body Structures | |
| Alfa Romeo Giulietta | Body Structures | |
| Alfa Romeo Giulia | Body Structures | |
| Alfa Romeo Stelvio | Body Structures | |
| Opel | Astra | Body Structures |
Outlook
-The Company expects that its sales for the fiscal year ending December 31, 2018, will be approximately USD 2,140 million.
R&D Facilities
-The Company has a total of six technical centers located in the U.S., Germany, Italy, China, India, and Japan.
Capital Expenditure |
(in million USD) |
| FY ended Dec. 31, 2017 | FY ended Dec. 31, 2016 | FY ended Dec. 31, 2015 | |
| Overall | 104.1 | 116.3 | 119.7 |
-The decrease in capital expenditure in the fiscal year ended December 31, 2017 compared to the previous year was primarily due to the timing of customer program launches.
-The Company expects to invest approximately USD 150 million for capital expenditures in the fiscal year ending December 31, 2018.
Investments in U.S.
-The Company held a grand opening ceremony for its new plant in Fountain Inn, South Carolina, U.S. on June 5, 2017. The Company invested USD 75 million into the plant, which will manufacture large complex assemblies for BMW. The plant employed 40 workers at the time of the ceremony, but will increase its workforce by an additional 100 employees by the end of 2018. (From a news article on June 6, 2017)
-The Company is investing USD 49.3 million to expand two of its facilities in Kentucky, U.S. The Company will invest USD 29.4 million at its facility in Bardstown and USD 19.9 million at its facility at Shepherdsville. The expansions are in response to the addition of a new program to manufacture structural components for SUVs. The Bardstown expansion is expected to create 25 new jobs while the Shepherdsville expansion is expected to create 35 new jobs. (From a news article on April 15, 2017)