CIE Automotive, S.A. Business Report FY ended Dec. 2016
|(in million EUR)|
|FY ended Dec. 31, 2016||FY ended Dec. 31, 2015||Rate of change
1) Automotive business unit sales
-The Automotive business unit had sales of EUR 2,266.5 million in the fiscal year ended December 31, 2016, an increase of 7.6% from the previous year. The increase in sales was throughout the year, continued to consolidate its geographic and technological diversification strategy, executing several greenfield builds and acquiring strategic companies such as Amaya Telleria (3Q16) and Bill Forge (4Q16).
-The Company and Grupo Amaya Telleria have agreed to merge through the signing by the Company of a contract to acquire 100% of the equity of Grupo Amaya Telleria. This operation involves an investment by CIE Automotive estimated at EUR 186 million. Grupo Amaya Telleria is based in Ermua (Bizkaia, Spain) and with production through different subsidiaries in Spain (Basque Country and Galicia), Slovakia, Mexico and Brazil. The company manufactures components using aluminum injection molding and grinding technologies. Its main products are chassis, transmission and engine parts. (From a press release on May 9, 2016)
-The Company's Indian arm, Mahindra CIE Automotive Limited (MCIE) has announced the 100 percent acquisition of Bill Forge Private Limited (BFPL) for INR 13,312 million. This acquisition increases MCIE's operations in the high growth Asian markets and reinforces CIE group's / MCIE's position as a leading global forgings player. BFPL's complementary product and customer mix leads to a significant diversification in the business portfolio of MCIE India. Founded in 1982, BFPL is a precision forging company based in Bangalore, India with 6 manufacturing facilities in India across Bangalore, Coimbatore and Haridwar and an upcoming plant in Celaya, Mexico. BFPL is a crucial supplier to a number of domestic and global two-wheeler and passenger car OEMs and Tier 1 auto component companies. It manufactures a variety of cold, warm, hot forged and machined components primarily for steering, transmission and wheel-related assemblies. This acquisition is scheduled to be completed by the end of October 2016. (From a press release on September 12, 2016)
-Mahindra CIE Automotive Ltd informed that its management has approved the amalgamation scheme of wholly-owned overseas subsidiaries, Mahindra Forging Global Limited (MFGL) and Mahindra Forgings International Limited (MIFL), to the parent company. This amalgamation will help Mahindra CIE to significantly reduce the multiplicity of legal and regulatory compliance requirements, which presently performed by MFGL and MFIL. Since MFGL and MFIL are wholly-owned overseas subsidiaries of the company, no shares will be issued as consideration for the amalgamation. (From stock exchange filing on December 12, 2016)
-Awards which the Company won in 2016
|Awarding Company||Awarded factory||Name of the award|
|Ford||Autometal Camacari (Brazil)
CIE Autocom Brazil (Brazil)
|Top Suppliers Awards 2016|
|PSA||ACS Iberica (Spain)||PSA Best Plant 2016|
|GM||CIE Mar SK (Slovakia)
CIE Egana (Spain)
CIE Udalbide (Spain)
CIE Pemsa Celaya (Mexico)
|Supplier Quality Excellence award|
|M&M||Mahindra CIE Forging Pune (India)
CIE Gears Rajkot (India)
|Cummins||Mahindra CIE Foundry (India)||Preferred Supplier|
|VW||CIE Pemsa Celaya (Mexico)||Zero Defects Strategy|
|Nissan Group||CIE Pemsa Celaya (Mexico)||Regional supplier quality
|Sisamex||CIE Legazpi (Philippines)||Excellent Supplier|
Mid-term plan (2016-2020)
Targets for the fiscal year ended December 31, 2020
- Sales: 7%
- Return on net assets (RONA): 20-25%
- EBIT margin: 12%
- Net Dept to EBITDA ratio: 0.5
- Accumulated Capital Expenditures (2016-2020): 6% of revenue
-The Company has 8 R&D centers worldwide.
- South Africa
Integrated electric drivetrain project
-As of 2013, the Company is involved in a research project titled ODIN, which stands for Optimized electric Drivetrain by Integration. As part of a consortium with other companies including Bosch, Fuchs, GKN Driveline, and Renault, the ODIN project is focused in developing integrated propulsion systems using high-speed electric engines. The goal of the ODIN project is to combine a next-generation gearbox, a high-speed electric engine, and embedded power electronics into a single system.
|(in million EUR)|
|FY ended Dec. 31, 2016||FY ended in Dec. 31, 2015||FY ended in Dec. 31, 2014|
-The Company’s Automotive unit invested EUR 186 million in the fiscal year ended December 31, 2016. Of this total, 59% (EUR 109 million) was earmarked to enhancing the productivity, quality and flexibility of existing facilities, while the remaining 41% (EUR 77 million) was invested in greenfield projects and capacity expansion work.
Investment Outside Spain
-In November 2015, the Company inaugurated a new factory in Togliatti, Russia, dedicated to the production of injection molded and machined aluminum parts.
-In 2013, the Company announced the construction of a new plant in Togliatti, Russia for the production of aluminum parts. The plant is located in close proximity to Renault-AvtoVAZ facilities and will produce aluminum parts for Renault's H4M engine. When completed, the plant is expected to produce 6,500 tons of aluminum parts per year and generate 230 jobs in the region.
-In July 2015, the Company inaugurated a new factory in Pernambuco, Brazil, which manufactures plastic parts for FCA and tier 1 suppliers.
-In 2014, the Company doubled the size of its factory in Nanjing, China, adding crankshaft manufacturing capability and enhancing its forging capabilities. It also launched the first electronic power steering machining plant to satisfy demand.
-In 2014, the Company is building 4 greenfield factories in the machining, forging, stamping and aluminium areas in Mexico. The new capacity will set the unit's direction to 2017.
-The Company's subsidiary, CIE Celaya, completed a 3,100-square-meter expansion to its facility in 2013. The expansion will house machinery used for the Company's new programs.
-The Company is in the process of developing a Greenfield hot forging plant in Mexico that will specialize in the manufacture of forged crankshafts. Construction began at the facility in Celaya in the first quarter of 2013. Crankshaft production is scheduled to begin in August 2014.
-In 2012, CIE LT Forge, a subsidiary of the Company in Lithuania, obtained official certification for its first crankshaft. CIE LT Forge launched its first production line of forging presses for crankshaft manufacturing.
Investment in Spain
-In November 2015, the Company inaugurated the fifth forged crankshaft manufacturing line at the CIE Galfor plant in Ourense, Spain.
-In December 2011, CIE Galfor, a subsidiary of the Company, inaugurated its fourth crankshaft production line. EUR 7 million was invested to develop the new production line. With this new line, annual production at the facility increased by one million units to a total of 3.2 million units in 2012.