Williams Controls Reaches Unit Milestone in Production Contracts
26 October 1999
Williams Controls Reaches 500,000 Unit Milestone in First Year Production Contracts for Automotive Electronic Throttle Controls
PORTLAND, Ore., Oct. 26 -- Williams Controls, Inc.
today announced that the company has now received contracts for
first year production of over 500,000 units of the company's automotive
electronic throttle control (ETC) products. This level was reached with the
announcement last week of a contract to provide ETCs for Ford Motor Company.
Over 18 months ago, Williams Controls announced its intent to take its 13
years of success and market dominance with ETCs in the truck markets and
transfer the technology into the passenger vehicle market. This new market
has the potential to be nearly 40 times the unit size of Williams' traditional
truck markets within the next five years. Since that time, the company has
invested significant time and financial resources to adapt its ETC technology
to the needs of the Big Three American automobile manufacturers. The
following is a summary of previously announced new awards for passenger
vehicle ETC.
General Motors
Williams Controls' initial success with automotive ETCs occurred in May of
this year when the company announced that it had been awarded a contract to
manufacture ETCs for the Chevrolet Corvette with an estimated first year
production of 35,000 systems. The Company was also awarded a contract for
approximately 55,000 ETC systems for a number of light and medium duty truck
models manufactured by General Motors. Revenues from these contracts,
estimated to exceed $3 million per year, began in September 1999.
On June 18, 1999, the company announced that it has been awarded its
second automotive ETC contract with General Motors, a five-year contract to
manufacture ETCs for the Pontiac Grand Prix automobile. The contract was
awarded for the year 2003 model and production of the estimated 160,000 annual
units is expected to begin in the summer of 2002. Revenues over the life of
this five-year agreement are estimated to be $9 million.
The Pontiac Grand Prix is based on General Motors' "W" car platform, the
total production of which is 800,000 annual units. While only the Grand Prix
contract has been awarded to date, total ETC expenditures for the "W" car
platform could reach $45 million over the five year period, once all models
convert to ETC technology.
Chrysler
On July 29, 1999, Williams Controls announced that it had purchased the
assets of the ProActive Pedals Division of Active Tool & Manufacturing Company
of Roseville, Michigan. ProActive is a leading designer and developer of
patented adjustable foot pedal systems and modular pedal systems. ProActive
was the first manufacturer of adjustable foot pedals, supplying the high-
performance Dodge Viper with current annual production of approximately 1,600
units.
Ford
On October 15, 1999, Williams Controls announced that it has been awarded
a contract to manufacture electronic throttle controls (ETCs) for a future
Ford vehicle. Production will begin in the middle of the year 2000. The
contract was the largest automotive ETC contract to be awarded to Williams up
to that time.
Summary Comments
Williams Controls Chairman and Chief Executive Officer, Thomas W. Itin,
stated, "The passenger vehicle market is moving rapidly to the adoption of
electronic throttle controls in the United States, and we also expect the
international market to move to this technology in the near future.
Furthermore, adjustable pedal systems are quickly emerging as a new product
because they greatly improve driver safety, convenience and comfort. Our
investments over the past 18 months have us well positioned to be a key player
in this market."
"Williams Controls has been the leading developer and manufacturer of ETC
systems in the truck markets since the product's inception in the mid-1980s.
We made the decision to enter the emerging passenger vehicle market and apply
our 13 years of research and development expertise in this area. Our ability
to win these five long term contracts proves that our technology and expertise
transfers well into the passenger vehicle market. We expect that most
domestic passenger vehicles will convert to ETC systems during the next five
years and that the emerging adjustable pedal market, and the sensors that
drive these products, could develop into a sizeable additional market for the
Company. We are currently working on a number of ETC and adjustable pedal
programs for the Big Three. While formidable competition exists in this new
market, management expects to win its fair share of this substantial and
rapidly growing market."
Williams Controls is a manufacturer and integrator of sensors, controls
and communications systems for the transportation and communication
industries. You can reach us on the Web at http://www.wmco.com .
The statements included in this news release concerning predictions of
economic performance and management's plans and objectives constitute forward-
looking statements made pursuant to the safe harbor provisions of Section 21E
of the Securities Exchange Act of 1934, as amended, and Section 27A of the
Securities Act of 1934, as amended. These statements involve risks and
uncertainties that could cause actual results to differ materially from the
forward-looking statements. Factors which could cause or contribute to such
differences include, but are not limited to, factors detailed in the Company's
Securities and Exchange Commission filings; economic downturns affecting the
operations of the Company or any of its business operations; and the
unavailability of financing to complete management's plans and objectives.
The forward-looking statements contained in this press release speak only as
of the date hereof and the Company disclaims any intent or obligation to
update these forward-looking statements.