Delphi Books More Than $3 Billion in Global Wireless Business During 2003
Delphi Solidifies Position as Leading Global Automotive Supplier of Wireless
New Products and More Customers Drive Delphi's Growth in Asia-Pacific and Europe
LAS VEGAS, Jan. 7 -- Delphi Corp. won more than $3 billion in new wireless business from automakers during 2003, company officials said here today at the 2004 International Consumer Electronics Show.
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The revenue from the new business will be generated over the next 4 years. Details of the contracts remain confidential at the customers' request.
The new bookings represent a 50-percent year-over-year increase. In 2002, Delphi booked just under $2 billion in new wireless business, which includes antennas, analog and digital receivers, audio, telematics and advanced entertainment and information systems like navigation and rear-seat entertainment.
"With this new business, we have solidified our leading position in the global automotive wireless market," said Jeff Owens, president, Delphi Electronics & Safety. "New product introductions, new technologies, new customers and a global footprint have allowed us to fully capitalize on the enormous consumer demand for wireless technologies."
Dr. Bob Schumacher, business line executive for Wireless at Delphi Electronics & Safety, attributes the growth to a combination of factors. "The appetite for wireless products is huge in nearly every region of the world," Schumacher said. "We're able to capitalize on this demand because we've built a great portfolio of current and future products that have strong consumer appeal, and we've done this in a very short period of time."
"This encompasses meeting that demand in both the original equipment and retail markets," he added. "Our retail business has gained momentum with the success of our SKYFi satellite radio and we're continually bringing new products and services to the retail market to leverage and maintain that energy.
"Further, we've expanded our global footprint to provide the right technical and manufacturing resources to our customers in local markets all over the world, which is allowing us to win more business and to diversify our customer base," he said. "All of these factors have positioned us to grow our business quickly."
Highlights of Delphi's wireless growth story include the following: Rapidly Growing Market - More customers and New Products
Delphi's success with its wireless business starts with a robust market that's been growing for the past five years and continues to be on the rise, Schumacher noted.
Based on customer contracts and production schedules, for 2004 Delphi will supply 9.4 million receivers to its original equipment customers, which represents a 75-percent increase since 1998. Considering market projections and bookings for 2007, Delphi expects its receiver sales to grow to over 11 million units.
"In North America, we are seeing explosive growth in rear-seat entertainment systems, navigation, satellite digital audio receivers, and MP3 music playback," Schumacher said. "In Europe, there is great interest in navigation, terrestrial digital TV, Bluetooth technologies, Wireless Application Protocol, and digital tuners."
With the ability to meet the wide variety of customer needs with high quality, high-tech products, Delphi is on track to meet its customer diversification goals. New contracts for wireless business have been reached with U.S., European, and Asian vehicle manufacturers.
Growth in New Products - Explosion in Satellite Radio Receivers Leads Way
According to Schumacher, Delphi's portfolio allows the company to capitalize on a rapidly growing consumer electronics market, and the market has embraced Delphi's new product offerings. An example is with the revolutionary satellite radio technology.
In just the short time since its introduction, Delphi has sold 1.8 million satellite digital audio receiver systems for XM and SIRIUS to vehicle manufacturers and retail customers.
Delphi has also sold increasing volumes of radio head units and receiver boxes, MP3 radios, navigation systems, rear-seat entertainment systems, Bluetooth(TM) and Wireless Application Protocol Internet browser technologies, terrestrial digital TV and advanced active antenna systems.
Robust Technology Pipeline - 14 New Technologies Scheduled to Debut
"Beyond its current product lineup, Delphi currently has 14 new technologies scheduled to debut soon with more introductions to come," Schumacher said. "The key is that these products cover a range of consumer groups, from the entry-level all the way to the luxury market." Highlights include:
* Satellite Digital Audio Receiver Integrated Radio Head Unit - Next- generation chipsets will reduce the circuit board size and allow for integration of the remote satellite receiver box into the existing radio. The simplified design includes a less complex wiring harness, weight reduction and easier installation (expected availability in 2006).
* 5.1 Surround Sound/Polk Premium Audio - Delphi combines the world-class performance and brand recognition of Polk Audio and puts the vehicle on the technological edge of car audio and in-car entertainment (expected availability in 2005).
* High-End Navigation with Touch Screen Interface and Lane Guidance Information - This unit will make navigation systems even easier to operate while providing additional information regarding what lane to be in to more easily follow the suggested navigation route (expected availability in 2005).
* SIRIUS Radio with Video Capability - Video is broadcast using the SIRIUS satellite network. Delphi's system allows the video to be viewed by vehicle occupants on dual 7-inch display screens. Passengers can independently choose between audio and video satellite broadcasts (expected availability in 2005).
* Low Profile Geo-Satellite Tracking Antenna and Reception in Moving Vehicle - Integrates an advanced antenna into the vehicle roof without compromising vehicle styling and provides reliable satellite TV reception in a moving vehicle. The antenna electronically scans and tracks the signal (expected availability in about 5 years).
* WiFi/802.11 Music and Video Download - Offers wireless connectivity between vehicles and home computers, work and other remote networks. Users can share data with their vehicle just as data is shared between laptops and personal digital assistants (expected availability in 2007).
* Delphi XM SKYFi Integrated CD Player - This new portable audio system that docks the Delphi XM SKYFi receiver also integrates AM/FM radio, CD player and MP3 player in one portable unit (expected availability in January 2004).
Expanding Global Footprint - More Coverage in Asia, Europe
Delphi has further enhanced its ability to service customers worldwide by expanding its global footprint.
In China, Delphi last year established a new technical center in Shanghai and a new manufacturing site in Suzhou will be completed in 2004. Both facilities enable Delphi to engineer and manufacture wireless products for the local market.
In Europe last November, Delphi announced the acquisition of Grundig Car InterMedia Systems GmbH. By integrating Grundig into Delphi's wireless Europe business, Delphi has improved its already strong position in the region.
"This is a global business, and companies need a strong global footprint to compete," Schumacher said. "Our new facilities and acquisitions have made Delphi a much stronger presence in both regions."
Many of the technologies represented in Delphi's wireless business bookings will be on display at the 2004 International Consumer Electronics Show.
For more information about Delphi and its subsidiaries, visit Delphi's media room at www.delphi.com/media .
All statements contained or incorporated in this press release which address operating performance, events or developments that we expect or anticipate may occur in the future (including statements relating to future sales or earnings expectations, savings expected as a result of our global restructuring or other initiatives, portfolio restructuring plans, volume growth, awarded sales contracts and earnings per share expectations or statements expressing general optimism about future operating results) are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are made on the basis of management's current views and assumptions with respect to future events. Important factors, risks and uncertainties which may cause actual results to differ from those expressed in our forward-looking statements are discussed in detail in our filings with the Securities and Exchange Commission, including our annual report on Form 10-K for the year ended December 31, 2002. In particular, the achievement of projected levels of revenue, earnings, cash flow and debt levels will depend on our ability to execute our portfolio and other global restructuring plans in a manner which satisfactorily addresses any resultant antitrust or labor issues and customer concerns, any contingent liabilities related to divestitures or integration costs associated with acquisitions, and other matters; the success of our efforts to diversify our customer base and still maintain existing GM business; the continued protection and exploitation of our intellectual property to develop new products and enter new markets; and our ability to capture expected benefits of our cost reduction initiatives so as to maintain flexibility to respond to adverse and cyclical changes in general economic conditions and in the automotive industry in each market we operate, including customer cost reduction initiatives, potential increases in warranty costs, pension contributions, healthcare costs, disruptions in the labor, commodities or transportation markets caused by terrorism or war and other changes in the political and regulatory environments where we do business. Delphi does not intend or assume any obligation to update any of these forward-looking statements.
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