Haldex to consolidate CVS manufacturing to plant in Monterrey, Mexico

As a final step in the earlier announced cost-reduction program, Haldex conducted a review of its Commercial Vehicles Systems’ (CVS) production structure in North America. The review resulted in measures for a further concentration of CVS’ North American manufacturing to the Haldex plant in Monterrey, Mexico.

The plant is located in a region of increasing significance for the North American automotive industry and has recently undergone an investment program.

Within the framework of the review, manufacturing from Haldex’s plant in Iola, Kansas, will be relocated to Monterrey, whereupon the operation in Iola will be discontinued during the second half of 2010. The production of brake cylinders was relocated to the operation in Monterrey earlier.

Costs for the planned measures will amount to USD 5.6 m (about SEK 45 m) and will generate annual savings of US$6 million (about SEK 50 million).

In addition, personnel cutbacks are planned for certain areas of CVS’s operations, the costs for which are expected to amount to SEK 10 million to 15 million, and will generate annual savings of approximately the same amount.

The costs will be charged to earnings in the third quarter of 2010.

Haldex, headquartered in Stockholm, Sweden, is a provider of proprietary and innovative solutions to the global vehicle industry, with focus on products in vehicles that enhance safety, environment and vehicle dynamics. The company employs approximately 4,000 workers.