Visteon Corporation has predicted it will report a steep fall in fourth quarter product sales as vehicle production at its major customers continues to slump.
The Tier One supplier said in a statement that sales for fourth quarter 2008 were estimated at US$1.55bn compared to $2.7bn a year earlier, while full year 2008 sales were estimated at $9.1bn.
The company said about 22% of fourth quarter sales were in North America, with 37% in Europe and 35% in Asia-Pacific.
“The reduction in fourth quarter sales compared with a year ago is largely attributable to significantly lower vehicle production by Visteon’s global customers,” the supplier said.
Year-end 2008 cash balances totalled $1.18bn, which included $75m drawn under the company’s principal US credit line. Visteon’s debt balances at year-end 2008 were approximately $2.76bn.
The US group also reported on its restructuring plan, saying it had completed the plan at a lower cost and with greater savings than originally planned.
Recent actions taken at two western European manufacturing locations brought to 30 the number of facilities addressed. At the end of 2008, $68m was available in the escrow account to fund future restructuring.
“Visteon continues to take other aggressive actions in light of the current vehicle production environment. The company is on track to complete, by the end of first quarter 2009, the reduction of 800 salaried employees globally, announced in October 2008,” the company said.
“This action will generate an estimated per annum savings of $60m once completed.”
For January, Visteon imposed a four-day work week schedule on about 2,000 salaried workers at its Van Buren Township and Plymouth, Michigan facilities in line with a 20% reduction in base salaries.
The company also has implemented other actions to reduce costs including the suspension of 401(k) [pension plan] matching contributions and 2009 salary increases, elimination of some benefits and a reduction in new recruiting.