Visteon Finding Business Outside of Ford

December 7, 2001

Sacramento - While many were forecasting that Ford would announce a major reorganization this week, thus far all the company has done is issue a profit warning, noting that it expects to lose 50-cents a share in the fourth quarter, significantly more than it had originally forecast. While it appeared to be a big surprise to many, including stock traders who dumped Ford stock and sent its value down 72-cents in one day, it should not have been a surprise. Ford has been very transparent about its problems and that has helped some of its suppliers survive.

One of those is Visteon. With only a year out of the Ford family, Visteon was extremely vulnerable to the current economic situation. However, at the outset the company said one of its major objectives would be to become less reliant on Ford.

The company continues to that, announcing yesterday that it has signed a deal with PSA Peugeot Citroen to develop new technology for body electronics, chassis, climate control, interior lighting, and powertrain systems. The agreement is interesting in that the French have typically had their own way of doing things. Agreements such as this indicate they may be more interested in adapting some western concepts for their vehicles.

As well, these are the types of agreements that will help keep Visteon alive while its largest customer, Ford Motor, goes through a difficult economic crisis.