UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
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November 15, 2004
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Dana Corporation
Virginia | 1-1063 | 34-4361040 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification Number) |
4500 Dorr Street, Toledo, Ohio | 43615 | |
(Address of principal executive offices) | (Zip Code) |
Registrants telephone number, including area code:
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(419) 535-4500 |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 8.01. Other Events. | ||||||||
Item 9.01. Financial Statements and Exhibits. | ||||||||
Signatures | ||||||||
EX-99.1 Press Release |
Item 8.01. Other Events.
On November 15, 2004, Dana Corporation issued a news release containing comments by Michael J. Burns, Danas Chairman and Chief Executive Officer, regarding the sale of the companys automotive aftermarket businesses and cost savings opportunities. A copy of that release is attached to this Form 8-K as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
(c) | Exhibits |
99.1 | Press release of Dana Corporation dated November 15, 2004 |
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dana Corporation (Registrant) |
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Date: November 15, 2004 | By: | /s/ Michael L. DeBacker | ||
Name: | Michael L. DeBacker | |||
Title: | Vice President, General Counsel and Secretary | |||
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Exhibit 99.1
Contact: | Michelle Hards | |||
(419) 535-4636 | ||||
michelle.hards@dana.com |
DANA CORPORATION CHAIRMAN COMMENTS
ON AFTERMARKET SALE AND COST SAVING OPPORTUNITIES
TOLEDO, Ohio, Nov. 15, 2004 In recent meetings with analysts and investors, Michael J. Burns, chairman and CEO of Dana Corporation (NYSE: DCN), confirmed the companys confidence that it will complete the sale of its automotive aftermarket businesses to an affiliate of The Cypress Group by the end of November.
Mr. Burns reiterated Danas plans to use proceeds from the sale for an additional contribution of up to $200 million to the companys pension plans and for further reduction of Danas debt, both of which are expected to accelerate the companys return to investment-grade status. Additionally, over the long term, Dana will reinvest in its core businesses to improve its cost structure and strengthen top-line growth. This is expected to be done through consolidation of its manufacturing base, as well as investments in joint ventures and selective acquisitions.
Mr. Burns also commented on a series of company actions designed to significantly reduce costs, including leveraging its global purchasing efforts, accelerating the deployment of lean manufacturing techniques, extending its value engineering efforts, and standardizing administrative processes.
Purchasing
Consolidation
Paul Miller, Danas new vice president of purchasing, is accelerating the
consolidation of the companys purchasing activities, which were widely
dispersed and operated on a number of different IT systems.
Danas cost of direct and indirect materials and purchased services totals more than $4.5 billion annually. By fully leveraging its purchasing power, Dana hopes to realize a significant reduction in these costs over the next several years, but cannot project the actual cost savings at this time, as the full impact of this initiative is still being assessed.
Mr. Burns commented that this initiative has proven timely, as it has helped to partly offset the higher cost of steel and other commodities that Dana has faced this year and expects to face in 2005. Incremental steel costs in the third quarter of 2004 impacted the companys continuing operations by approximately $40 million before tax. Mr. Burns expressed hopes that steel cost increases will subside in 2005, but reiterated that the company is taking a conservative approach in planning for next year.
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Lean Manufacturing
Another significant opportunity for cost savings is lean manufacturing
techniques, including value stream mapping and commonizing on best processes
globally. Value stream maps graphically chart manufacturing and other business
processes to enable the company to identify and eliminate non-value-added
activity.
Dana has recently adopted a standardized approach to value stream mapping. The company has mapped 39 processes to date, and the results are encouraging. This technique could be applied to hundreds of processes across the company. If the initial results are indicative, Dana could potentially achieve substantial savings in the long term. However, at this early stage, no firm estimate of savings can be made.
Value Engineering
Value analysis/value engineering (VA/VE) represents an additional opportunity
for savings. VA/VE is a process done in conjunction with customers to redesign
components to reduce costs. Mr. Burns commented that the benefits of VA/VE can
translate not only into cost savings, but also into top-line growth.
Standardized Administrative Processes
Mr. Burns also indicated that Dana is working aggressively to standardize
administrative processes in areas such as information technology, finance, and
human resources. He added that, like purchasing, these processes have been
operating in a very decentralized environment, and standardization will not
only reduce cost, but also improve effectiveness.
Conclusion
Mr. Burns reiterated that the sale of the automotive aftermarket businesses is
an important strategic step for Dana. In the near term, the company will
realize the benefits of lower pension and interest expense. In addition, while
no plans or cost saving estimates have been finalized, Dana is studying ways to
enhance its manufacturing footprint through consolidation, joint ventures, and
selective acquisitions. This will enable Dana to better serve its global
customers and further improve its cost structure in the longer term. Mr. Burns
concluded that these efforts, coupled with the ongoing cost saving initiatives,
will better position Dana for the future.
Dana Corporation is a global leader in the design, engineering, and manufacture of value-added products and systems for automotive, commercial, and off-highway vehicles. Delivering on a century of innovation, the companys continuing operations employ approximately 45,000 people worldwide dedicated to advancing the science of mobility. Founded in 1904 and based in Toledo, Ohio, Dana operates technology, manufacturing, and customer-service facilities in 30 countries. Sales from continuing operations totaled $7.9 billion in 2003. Danas Internet address is www.dana.com.
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Forward-Looking
Statements
Certain statements contained in this release constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. These statements represent Danas expectations based on our current
information and assumptions. Forward-looking statements are inherently subject
to risks and uncertainties. Danas actual results could differ materially from
those that are anticipated or projected due to a number of factors. These
factors include the success and timing of the sale of the automotive
aftermarket businesses; the extent and success of our cost reduction, lean
manufacturing, VA/VE, and cash management programs; increases in commodity
costs, including steel, that cannot be recouped in product pricing; competitive
pressures on our sales and pricing; the ability of our customers and suppliers
to achieve their projected sales and production levels; and other factors set
out in our public filings with the Securities and Exchange Commission. Dana
does not undertake to update any forward-looking statements in this release.
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