DETROIT – Dura Automotive Systems Inc. makes the transition from shuttering non-core global operations to opening new facilities with the announcement of a new technical center in Velizy, France.
Dura, which has been knee-deep in a financial restructuring aimed at eliminating a $1 billion debt load, says the new facility is designed to attract local customers.
Until now, Renault SA, PSA Peugeot-Citroen and Renault-affiliate Nissan Motor Co. Ltd. have proven elusive for Dura, which focuses on control systems and body and glass components.
But Dura’s new 11,840-sq.-ft. (1,100-sq.-m) facility in Velizy shares a back fence with Peugeot-Citroen’s research and development center and is a short drive from Renault’s headquarters in Boulogne Billancourt. It is staffed by 45 employees, who are developing existing products, such as driver controls, seat controls, door modules and glass systems, for French OEMs. The center soon will begin working on new products for the French market, including Dura’s RackLift window-raising system and its shift-by-wire system, says Larry Denton, Dura president and CEO.
The French facility falls in lockstep with Dura’s goal of increasing its non-Big Three customer base. Currently, 56% of sales are to General Motors Corp., Ford Motor Co. and DaimlerChrysler AG’s Chrysler Group. Dura aims for a 50/50 U.S. Big Three-international auto maker mix in the next five years. And Denton sees France as a huge opportunity: France holds 29% of Europe’s auto market, but only 12% of Dura’s European business goes there.
“This strategy is nothing more than standard blocking and tackling,” Denton says. “This isn’t rocket science, but it works, and it works well.”
Dura has similar expansion objectives in low-cost markets such as Spain and Mexico, as well as with North America’s transplant auto makers.
Denton, who was hired last year to help turn around the ailing supplier, also has targeted net debt reduction as another primary objective. Thus far, some $295 million of the $1 billion debt load has been paid down, and Denton is aiming for unburdening another $40 million-$50 million this year.
Dura also plans to continue its cost-reduction efforts, which have saved $50 million-$100 million annually for the last few years. It also has centralized its purchasing, finance, human resources and information technology departments.