LEAR
Job losses and relocation eastwards / Plant closures planned in Europe and North America
The succession of bad news from the US automotive industry shows no sign of abating. Following the turbulence at Delphi and Visteon and Meridian´s Chapter 11 announcement, automotive supplier Lear (Southfield, Michigan / USA; www.lear.com) has announced plans to restructure up to 20 of its 167 facilities worldwide or move them to lower- wage countries. At the same time 7,700 of the company´s 110,000 jobs are to be slashed.
First to be affected will be five plants in Europe and North America. Lear will disclose details of the locations in its report on Q2 2005 at the end of July. A total of 35,000 employees currently worked at 73 facilities in Europe. Some 61of these plants are in the high-wage countries of western Europe, including 22 – more than a third – in Germany.
Lear has been giving serious consideration to shifting production to low-wage countries for a number of months – especially in conjunction with the new strategy of expanding business with car makers in Asia, such as the FAW (VW) and DongFeng (Peugeot Citroen) joint ventures. This move has been prompted by structural problems in the European and North American markets, with overcapacity at the OEMs cited in both cases. New facilities were opened in the Czech and Slovak Republics in 2004, while existing units in Romania and Poland were expanded.
Lear is specialised in vehicle interiors. With overall sales of just under USD 17 bn, the group is engaged in the three segments of seating systems (67%), interior trim (17.5%) – which takes in instrument panels, door and floor coverings, acoustics and overhead systems – and electronics (15.8%). This latter segment was the sole area in which sales increased in 2004; the other two units shrank slightly, with EBIT falling in both. While US sales declined in 2004 to USD 6.2 bn (USD 6.36 bn in 2003), positive developments were seen in most other countries. This weakness in the US is due undoubtedly to the slump in orders from GM and Ford, which account for almost 55% of Lear´s sales. DaimlerChrysler and BMW trail at some distance, accounting for 11.8% and 7.5% respectively.
• e-Service:
Lear financial report 2004 on US-Form “10-K” as PDF document (427 KB)
First to be affected will be five plants in Europe and North America. Lear will disclose details of the locations in its report on Q2 2005 at the end of July. A total of 35,000 employees currently worked at 73 facilities in Europe. Some 61of these plants are in the high-wage countries of western Europe, including 22 – more than a third – in Germany.
Lear has been giving serious consideration to shifting production to low-wage countries for a number of months – especially in conjunction with the new strategy of expanding business with car makers in Asia, such as the FAW (VW) and DongFeng (Peugeot Citroen) joint ventures. This move has been prompted by structural problems in the European and North American markets, with overcapacity at the OEMs cited in both cases. New facilities were opened in the Czech and Slovak Republics in 2004, while existing units in Romania and Poland were expanded.
Lear is specialised in vehicle interiors. With overall sales of just under USD 17 bn, the group is engaged in the three segments of seating systems (67%), interior trim (17.5%) – which takes in instrument panels, door and floor coverings, acoustics and overhead systems – and electronics (15.8%). This latter segment was the sole area in which sales increased in 2004; the other two units shrank slightly, with EBIT falling in both. While US sales declined in 2004 to USD 6.2 bn (USD 6.36 bn in 2003), positive developments were seen in most other countries. This weakness in the US is due undoubtedly to the slump in orders from GM and Ford, which account for almost 55% of Lear´s sales. DaimlerChrysler and BMW trail at some distance, accounting for 11.8% and 7.5% respectively.
• e-Service:
Lear financial report 2004 on US-Form “10-K” as PDF document (427 KB)
14.07.2005 Plasteurope.com [203082]
Published on 14.07.2005
German version of this article...