Dana Corp. today announced that its Board of Directors has approved several “operational and strategic initiatives to enhance financial performance.” The key changes to be made were described as:
Focusing on Dana's light- and heavy-vehicle drivetrain products, associated structures, sealing, and thermal products, and divesting three non-core businesses with annual revenues of $1.3 billion.
Operational restructuring in Dana's Automotive Systems and Heavy Vehicle Technologies and Systems groups.
Enhanced business efficiency, including workforce reductions.
Benefit cost reductions.
Dana said the three non-core businesses it will shed are engine hard parts, fluid products, and pump products.
The engine hard parts business, consisting of 26 operations which primarily manufacture piston rings, camshafts, and engine bearings under the Perfect Circle, Clevite and Glacier Vandervell brand names, posted 2004 sales of $720 million.
The fluid products business, which netted $470 million in sales in 2004, manufactures goods for braking, power steering, HVAC and fuel applications. The pump products business, which posted $80 million in revenue last year, consists primarily of original equipment and aftermarket pump operations in Brazil.
Within its Commercial Vehicle business, service parts activities at the Henderson, KY, facility will move to a service parts operation in Crossville, TN. Assembly activity will be increased at the Dana plant in Monterrey, Mexico, and gear production will be increased at the Toluca, Mexico, plant. These actions will “enhance efficiency, logistics and throughput,” Dana said.
Dana will close two Virginia facilities in its Automotive Systems Group, and consolidate manufacturing in Kentucky and Mexico, to “take advantage of lower cost locations,” the company stated.
“Collectively, these operational actions will result in a Dana Corporation that is even more focused on its light- and heavy-vehicle drivetrain products, associated structures, sealing, and thermal products businesses,” said Dana chairman & CEO Michael J. Burns. “While a number of the actions we are taking are painful, they are vital to refocusing our company, accelerating cost and process efficiencies, and driving improved performance across our global organization,” he added.