By Ben Klayman
CHICAGO (Reuters) - Honeywell International Inc's (HON.N: Quote, Profile, Research, Stock Buzz) chief executive voiced support on Tuesday for the diversified U.S. manufacturer's slow-growing consumer automotive products business.
"It's a great position in an OK industry in the U.S.," CEO Dave Cote said at the Reuters Manufacturing Summit in Chicago. "We are dealing with a tougher market, but just because things get tough doesn't mean you bail."
He said the Consumer Products Group business, which includes Prestone antifreeze, as well as spark plugs, has historically been a stable performer, even during bad times, but has been hit hard in the last two to three years by high gas prices.
Wall Street has not been happy with the growth rate of the unit and has often raised the idea of Honeywell, the largest maker of cockpit electronics, selling the business.
"We continue to believe that CPG could eventually be a potential divestiture candidate," wrote Goldman Sachs analyst Deane Dray in a note to clients on Monday.
Cote said the consumer automotive products business should see improved performance this year as the business should have hit a bottom in weak demand in 2007.
"Our focus with any business we have is make sure it runs better, and I would say there's more work in CPG to do," he said.
However, Cote emphasized the business makes up less than 4 percent of sales and less than 3 percent of income, so it "certainly doesn't define the company." Continued...
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