FEDERAL-MOGUL ESTABLISHES NEW OPERATING SEGMENT STRUCTURE
Operating segments realigned to strengthen focus on unique end-customer market requirements
SOUTHFIELD, Michigan, September 4, 2012..Federal-Mogul Corporation (NASDAQ: FDML) today announced the Company has begun operating with two business segments, each with a chief executive officer reporting to Federal-Mogul's Board of Directors. Federal-Mogul's powertrain segment focuses on original equipment products for automotive, heavy duty and industrial applications. The vehicle components segment sells and distributes a broad portfolio of products in the global vehicle aftermarket, while also serving original equipment (OE/OES) manufacturers with vehicle products including brake friction, chassis, wipers and other vehicle components.
"Today's announcement is the fulfillment of the direction established by the Company's Board of Directors in March 2012, to focus the business on the unique needs of customers who buy original equipment powertrain products, or aftermarket and vehicle components," said Rainer Jueckstock, co-CEO, Federal-Mogul and CEO F-M Powertrain Segment. "The two operating segments will continue to be divisions of Federal-Mogul Corporation and continue to use the FDML stock symbol."
The operational segmentation became effective on September 1, 2012 and future financial reporting of Federal-Mogul operating results will be based on this new two-segment structure.
"The new organizational model allows for a strong product line focus benefitting both original equipment and aftermarket customers and will enable the global Federal-Mogul teams to be responsive to customers' needs for superior products and to promote greater identification with Federal-Mogul premium brands," said Michael Broderick, co-CEO, Federal-Mogul and CEO Vehicle Components Segment.
Benefits of Segmentation
The Company's Board of Directors established the direction for segmenting business operations on the basis of end-customer needs unique to the global powertrain business as well as the global vehicle service components and aftermarket repair business.
The division of the global Federal-Mogul business into two operating segments is expected to enhance management focus to capitalize on opportunities for organic or acquisition growth, profit improvement, resource utilization and business model optimization in line with the unique requirements of the two different customer bases.
"We have made significant progress in the last five months in preparing the Company's major product lines to operate in structure with two independent segments. I am proud of the organization, as we have put in place the structure, leadership teams and operating approach while continuing to be focused on our customers and delivering quality products," said Mr. Jueckstock.
The following summary provides information of Federal-Mogul Corporation's two separate business segments (the full year 2011 sales information reflects the sales in the respective segments as if they had been segmented in this manner as of January 1, 2011):
Federal-Mogul Powertrain at a Glance
Full Year 2011 Sales: $4.2 billion (with intercompany sales)
Manufacturing Plants: 79
Engineering Centers: 12
Main Product Lines: Pistons, piston rings, cylinder liners, valve seats, valve guides, bearings, spark plugs, bushings, static gaskets and dynamic seals, heat shields, systems protection products
Federal-Mogul Vehicle Component Solutions at a Glance
Full Year 2011 Sales: $3.1 billion
Manufacturing Plants: 31
Engineering Centers: 8
Distribution Centers: 20
Primary Aftermarket Brands: AbexR , AER , ANCOR , BeralR , ChampionR , FP DieselR , Fel-ProR , FerodoR , GlycoR , GoetzeR , MOOGR , NationalR , NüralR , PayenR , Sealed PowerR , Speed-ProR , WagnerR
Main Product Lines: Engine and sealing components, brake friction, wipers, steering and suspension, fluids and chemicals
Federal-Mogul was founded in Detroit in 1899 and employs 45,000 people in 34 countries. Worldwide headquarters are in Southfield, Michigan, United States. For more information, please visit www.federalmogul.com.
Statements contained in this press release, which are not historical fact, constitute "Forward-Looking Statements." Actual results may differ materially due to numerous important factors that are described in Federal-Mogul's most recent report to the SEC on Form 10-K, which may be revised or supplemented in subsequent reports to the SEC on Forms 10-Q and 8-K. Such factors include, among others, fluctuations in domestic or foreign vehicle production, fluctuations in the demand for vehicles containing our products, the Company's ability to generate cost savings or manufacturing efficiencies to offset or exceed contractually or competitively required price reductions or price reductions to obtain new business, conditions in the automotive industry, the success of the company's segmentation and corresponding effects and general global and regional economic conditions. Federal-Mogul does not intend or assume any obligation to update any forward-looking statements.
David Pouliot for investor questions
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Source: Federal-Mogul Corporation via Thomson Reuters ONE