Federal-Mogul Corporation has split itself into two business segments, each with its own CEO reporting to the board of directors, a change intended to strengthen multi-brand organization’s customer focus in the automotive and aftermarket supply chains. One segment will be concentrated on powertrain products for OEMs in the automotive, heavy-duty equipment, and industrial markets.
The other new segment will address the vehicle components market segment with a portfolio of products for the worldwide vehicle aftermarket. It also will supply original equipment (OE/OES) manufacturers with vehicle products like brake friction, chassis, wipers, and other vehicle components.
The realignment became effective on September 1.
"Today’s announcement is the fulfillment of the direction established by the company’s board of directors in March 2012, to focus the business on the unique needs of customers who buy original equipment powertrain products, or aftermarket and vehicle components," stated Rainer Jueckstock, co-CEO of Federal-Mogul and CEO of the F-M Powertrain segment.
"The two operating segments will continue to be divisions of Federal-Mogul Corporation and continue to use the FDML stock symbol," Jueckstock continued.
"The new organizational model allows for a strong product line focus benefitting both original equipment and aftermarket customers and will enable the global Federal-Mogul teams to be responsive to customers’ needs for superior products and to promote greater identification with Federal-Mogul premium brands," said Michael Broderick, co-CEO, Federal-Mogul and CEO of the Vehicle Components segment.
The corporation added that dividing its businesses into two operating segments would the enhance managements’ focus on opportunities for organic or acquisition growth, profit improvement, resource utilization, and business model optimization in line with the particular requirements of their distinct customer bases.
The Federal-Mogul Powertrain division, which had FY2011 sales of $4.2 billion, has 79 manufacturing plants and 12 engineering centers worldwide, with 32,500 employees. Its main product lines include pistons, piston rings, cylinder liners, valve seats, valve guides, bearings, spark plugs, bushings, static gaskets and dynamic seals, heat shields, and systems protection products.
The Federal-Mogul Vehicle Component Solutions division had FY2011 sales of $3.1 billion. It has 31 manufacturing plants, eight engineering centers, and 20 distribution centers worldwide, with 12,500 employees. Its product lines include engine and sealing components, brake friction, wipers, steering and suspension, fluids and chemicals, and its aftermarket brands include: Abex, AE, ANCO, Beral, Champion, FP Diesel, Fel-Pro, Ferodo, Glyco, Goetze, MOOG, National, Nüral, Payen, Sealed Power, Speed-Pro, and Wagner.
Jueckstock emphasized that Federal-Mogul has in place the structure, leadership teams, and operating approach to be customer-focused and still deliver quality products. "We have made significant progress in the last five months in preparing the company’s major product lines to operate in structure with two independent segments," he said.