LEAR gabelli 103107

311 views

Published on

Published in: Economy & Finance
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
311
On SlideShare
0
From Embeds
0
Number of Embeds
4
Actions
Shares
0
Downloads
8
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

LEAR gabelli 103107

  1. 1. The 31st Annual Gabelli Automotive Aftermarket Symposium Lear’s Asian Strategy October 31, 2007
  2. 2. Agenda Company Overview Bob Rossiter, Chairman, CEO and President Lear’s Asian Strategy Lou Salvatore, Senior Vice President and President, Global Asian Operations Q and A Session 2
  3. 3. Lear Profile Lear is . . . a leading global supplier of automotive Seating systems, Electrical Distribution systems and Electronic products; that serves all of the world’s major automakers; with annual sales of $15 billion (Fortune #155); 236 facilities located in 33 countries; and more than 90,000 employees worldwide 3
  4. 4. Actions to Improve Shareholder Value* Implementing global restructuring initiative Refinanced 2007-2009 debt maturities Divested Interior business; retained minority interest in IAC joint ventures Improved operating earnings and cash flow Revitalized strategic focus on “growth” * Please see slide titled “Forward-Looking Statements” at the end of this presentation for further information. 4
  5. 5. Strong Competitive Position Lear is a true partner to all of the world’s major automakers, with strong market positions and superior quality in our core businesses: Seating Systems #2 position globally, in a market estimated to be about $45 to $50 billion in size: #2 position in North America and #3 in Europe #2 position in China and #1 in India Lear is the highest quality major seat manufacturer for the past 6 years, according to the J.D. Power Seat Survey Electrical Distribution Systems #3 position in North America, #4 in Europe and among the leaders in China Electronic Products Niche player in electronic modules, wireless products and audio/video applications 5 Source: Lear Market Share Study / CSM Worldwide Survey Data
  6. 6. Lear’s Business Imperatives* Superior quality and customer satisfaction Global scale in core businesses Technical competence in key components Lowest cost global footprint New product innovation Sales growth and diversification * Please see slide titled “Forward-Looking Statements” at the end of this presentation for further information. 6
  7. 7. Lear’s Asian Strategy 7
  8. 8. Forward Looking Trends* Consumers Growth in vehicle ownership Growth in micro and small cars Exports Increased exports from Asia to N.A. / Western Europe Domestic OEMs Government targeted domestic OEM share = 50% Supply Chain Customer ownership of supply chain Geographic Customers (and government) driving localization (components) Emerging Market India -- the next China (5+ years away) Asian Market = Continued Growth 8 * Please see slide titled “Forward-Looking Statements” at the end of this presentation for further information.
  9. 9. Asian Market Growth* Production Volumes High: 2007 2010 ∆ CAGR% CHINA China 6.8 M 9.3 M 2.5 M 11% ∆=2.5M India 1.8 M 3.4 M 1.6 M 24% Thailand 1.3 M 1.6 M 0.4 M 9% INDIA Sub-total High 9.9 M 14.3 M 4.5 M 13% ∆=1.6M Low: THAILAND Japan 10.7 M 11.3 M 0.6 M 2% ∆=0.4M Indonesia 0.3 M 0.5 M 0.2 M 17% Taiwan 0.3 M 0.4 M 0.1 M 11% Malaysia 0.5 M 0.6 M 0.1 M 9% Korea 3.9 M 3.9 M 0.0 M 0% Philippines 0.1 M 0.1 M 0.0 M 12% Australia 0.4 M 0.4 M (0.0)M 0% Sub-total Low 16.1 M 17.2 M 1.1 M 2% Total Asia 25.9 M 31.5 M 5.6 M 7% Source: CSM Worldwide, Inc., Global Light Vehicle Production Report, June 2007 2007 vs. 2010 Asian Market Growth = 7% CAGR High Volume Asian Growth (China / India / Thailand) = 13% 9 * Please see slide titled “Forward-Looking Statements” at the end of this presentation for further information.
  10. 10. Lear’s Asian Strategy* Sales Growth Aggressively grow faster than market Focus on local OEMs Strategic acquisitions (gain market share) Expand seat customer relationships to other products Profitability Lowest cost designs for customer specification Vertical integration (components) Manpower Emphasize local talent / leadership Quality Operational excellence “Best-in-class” launch execution Lear’s Asian Strategy = Growth, Local Markets, Optimized Costs, Local Leaders 10 * Please see slide titled “Forward-Looking Statements” at the end of this presentation for further information.
  11. 11. Aggressively Expanding Our Presence in Asia China India • 19 manufacturing facilities, 6 new in 2007 • 7 manufacturing facilities, 3 new in 2007 • 1 engineering center in Mumbai • 2 new engineering/R&D centers in • 3 program launches in 2006 Shanghai (includes CTO activities) • 4 program launches in 2007 • 18 program launches in 2006 • 7 customers • 26 program launches in 2007 • Seats (#1) • 20+ customers • Seats (#2), Electrical Distribution (among the leaders) and Electronic products ASEAN Korea • 2 manufacturing facilities • 2 manufacturing facilities • 1 engineering/CTO center in Cebu, • 1 engineering center in Seoul Philippines • Seats • 14 program launches in 2007 • Seats, Seat Trim Japan • 1 engineering center in Atsugi (Tokyo) • 1 engineering center in Hiroshima 37 Manufacturing / Engineering Facilities in Asia and Growing 11 Note: Includes facilities held through consolidated and non-consolidated joint ventures.
  12. 12. Lear China Customer Value Workshop Opening Ceremony with Lear and Chery Executives - Wuhu, China 12
  13. 13. Geely Signing Ceremony Geely Signing Ceremony 13
  14. 14. BAI Delegation Visit Signing Ceremony with Lear and BAI Executives at Southfield HQ 14
  15. 15. New Partnership – Lear Joint Venture with JAC LOI Signing Ceremony with Lear and JAC Executives in Hefei, China 15
  16. 16. Shanghai, China – Lear Engineering, Technical & Profit Improvement Center China Engineering Center / China Technical Center / China Profit Improvement Center Co-Location 16
  17. 17. Asia Profit Improvement Center Trim Wiring + Tracks Foam Idea Generation Section Asia PIC = Lowest Cost Designs For Each Customer Specification 17
  18. 18. 2007 Customer / Industry Recognition Shanghai GM Wuling “Supplier of the Year” • (China Liuzhou plant – 2006; first time awarded to a seat supplier) Mazda “VA Proposal Performance Award” – • for substantial contribution to cost reduction initiatives (2006 ; also received in 2004) Hyundai Mobis “one of outperforming suppliers in 2006” • (July 2007) FAW-Volkswagen “Best Seat Supplier Award” • (Changchun Lear - May 2007) 2007 = Continued Customer / Industry Recognition for Performance Excellence 18
  19. 19. 2007 Customer / Industry Recognition Labor Ministry of Thailand – Achievement of three million man • hours without injury (July 2007) Labor Ministry of Thailand – APC Awarded Excellence in Safety • Management (May 2007) Auto Alliance Thailand -- Achievement of one million seat sets built • and delivered (July 2007) Toyota – “Superior Award for Supplier Diversity 2006” – for the 3rd • consecutive year (March 2007) 2007 = Continued Customer / Industry Recognition for Performance Excellence 19
  20. 20. Aggressively Growing Total Asian Sales* Total Asian Sales – Core Businesses 2007 Highlights ($ in millions) Significant market position • in China: ~$2,850 – Total sales > $700 million ** – Supply 20+ OEMs on $2,200 > 100 vehicle programs – 19 manufacturing facilities $1,850 with approximately 6,000 employees – 2 new engineering/R&D centers in Shanghai – Our fastest growing market 11 new facilities in India • and China supporting Ford, Mazda, Chery, Tata, M&M, BMW and Hyundai 2005 2006 2007 Outlook Consolidated Non-consolidated * Includes sales in Asia and with Asian manufacturers globally. Please see slide titled “Forward-Looking Statements” at the end of this presentation for further information. ** Includes consolidated and non-consolidated sales. Targeting Continued Growth 20
  21. 21. Key Drivers For Profitable Growth* Lowest cost designs for each customer specification Localized engineering Localized component sourcing Best-in-class local talent Vertical integration (quality / cost) Continuous improvement and lean initiatives Operational improvements Export low cost engineering and components to ROW Profitable Growth = Strong Plans Will Succeed 21 *Please see slide titled “Forward-Looking Statements” at the end of this presentation for further information.
  22. 22. Closing Comments 22
  23. 23. Lear’s Asian Strategy* Sales Growth Aggressively grow faster than market Focus on local OEMs Strategic acquisitions (gain market share) Expand seat customer relationships to other products Profitability Lowest cost designs for customer specification Vertical integration (components) Manpower Emphasize local talent / leadership Quality Operational excellence “Best-in-class” launch execution Lear’s Asian Strategy = Growth, Local Markets, Optimized Costs, Local Leaders 23 * Please see slide titled “Forward-Looking Statements” at the end of this presentation for further information.
  24. 24. Q and A Session 24
  25. 25. R R ADVANCE RELENTLESSLY™ LEA Listed www.lear.com NYSE 25
  26. 26. Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding anticipated financial results and liquidity. Actual results may differ materially from anticipated results as a result of certain risks and uncertainties, including but not limited to, general economic conditions in the markets in which the Company operates, including changes in interest rates or currency exchange rates, the financial condition of the Company’s customers or suppliers, fluctuations in the production of vehicles for which the Company is a supplier, disruptions in the relationships with the Company’s suppliers, labor disputes involving the Company or its significant customers or suppliers or that otherwise affect the Company, the Company's ability to achieve cost reductions that offset or exceed customer-mandated selling price reductions, the outcome of customer productivity negotiations, the impact and timing of program launch costs, the costs and timing of facility closures, business realignment or similar actions, increases in the Company's warranty or product liability costs, risks associated with conducting business in foreign countries, competitive conditions impacting the Company's key customers and suppliers, raw material costs and availability, the Company's ability to mitigate the significant impact of increases in raw material, energy and commodity costs, the outcome of legal or regulatory proceedings to which the Company is or may become a party, unanticipated changes in cash flow, including the Company’s ability to align its vendor payment terms with those of its customers, the success of the Company's restructuring initiative and other risks described from time to time in the Company's Securities and Exchange Commission filings. The forward-looking statements in this presentation are made as of the date hereof, and the Company does not assume any obligation to update, amend or clarify them to reflect events, new information or circumstances occurring after the date hereof. 26

×