Late last year, it was difficult to see how Textron Automotive Co. - the leader in the US instrument panel market - would repeat its success in Europe.
Now, with a contract to supply Ford's Mondeo in Europe, a recently-announced joint venture to supply Fiat SpA, and two other deals expected to be announced shortly, Europe is sure to bring Textron substantially more business than the 24 percent of overall company sales it generated last year.
The Fiat deal completes months of effort by Sam Licavoli, who was promoted last month to chairman, president and chief executive of Textron in Troy, Michigan. His predecessor, John Janitz, is now president and chief operating officer of parent company Textron Inc.
Licavoli, 57, the former president of the company's trim division, said he expects the joint venture eventually to make cockpit modules for Fiat. That would add integrated electrical wiring, on-board electronics, air ducts, steering columns, front airbags and other components.
For Textron, leadership in supplying entire cockpit modules translates into six to eight times the content per vehicle it would have with just the instrument panel, Licavoli said.
Textron, which puts its share of the North American instrument panel market at 25 percent, is the largest single supplier. But Europe provides Licavoli's biggest challenge. Competitors here include Siemens Automotive and Sommer Allibert SA, which have a joint venture to build cockpit modules, as do Plastic Omnium SA (whose interiors operation was bought by Visteon earlier this month) and Valeo SA.
The company posted sales of $2.4 billion last year. It was ranked 17th on (US sister publication) Automotive News' list of the largest original-equipment suppliers to North America. Textron Automotive enjoyed higher North American sales last year because of more business with DaimlerChrysler, its largest customer.
Europe promises big things. 'We've been working on our globalization strategy,' Licavoli said. 'Our strategy is to balance customers and global presence ... so (the expansion in Europe) is a step in the right direction,' he said.
Textron partners in Europe include Magneti Marelli and Breed Automotive. With these suppliers, Textron has a contract to supply fully-integrated cockpit modules to Fiat for a new, mid-sized car due in 2001.
The new Ford Mondeo is due in Europe in October 2000. Textron Automotive, which supplies most of the current Mondeo's instrument panel, will supply the new model's complete cockpit, including the steering system, a Ford of Europe executive said last year.
The new Fiat venture will entail supplying 'a couple of hundred thousand vehicles per year,' said Licavoli. He declined to disclose the value of the contract.
Textron will have 60 percent of the venture with Breed Automotive holding 30 percent and Magneti Marelli 10 percent.
The joint venture had 1998 pro forma sales of about $150 million, with about two thirds of the business coming from Fiat.
- Joseph Pryweller of Plastics News contributed to this report