Blog: Dave LeggettValeo wants Visteon

Dave Leggett | 18 August 2006

It's reported that Valeo could be interested in buying Visteon. I’d give the reports some credence, as Valeo is interested in growth through acquisitions and also has a long history of interest in increasing its presence in the US.

FRANCE: Valeo after Visteon

I recall interviewing Valeo CEO Thierry Morin in his Paris office a few years ago. For a guy who is an accountant by training, his enthusiasm over the latest technologies and Valeo’s future growth strategy was impressive. He’s a man with a vision.

During the course of the interview, Morin maintained that he saw a big opportunity for Valeo in the US marketplace. In particular, he envisaged Valeo as a supplier adding value, with leading edge technology, that could help the Detroit Big Three to move away from a prevailing cost-down mentality (in relations with suppliers) and in the process actually improve customer perceptions of its products. It was an interesting argument, I thought.

Exclusive: Interview with Valeo's Thierry Morin

While Valeo has seen its profits fall lately, mainly on higher raw material costs, it is still a relatively strong performer and expanding rapidly. Morin – the man who turned Valeo around at the beginning of the decade – is continuing to deliver.

If Visteon - or a substantial chunk of it - ends up in Morin’s hands, Detroit could find that it has an even more powerful, switched on and potentially very helpful Tier 1 supplier in its midst. A nettle to grasp that could be beneficial. And it could be a smart move for Valeo, massively strengthening its US market (and global) presence at relatively low cost.

On a related note, there was research published earlier this week by consultants Roland Berger on supplier strategies. It forecasts suppliers accounting for an increased percentage of the value-added in vehicle production globally as hard-pressed vehicle makers require their suppliers to assume more engineering and design responsibilities.

US: Supplier strategies suggested

Roland Berger’s suggestions for supplier strategies must be music to Thierry Morin’s ears. And financially challenged Ford and GM might be a particularly fertile furrow for Valeo to plough in the coming years, especially with the possible addition of Visteon’s business in the case of Ford.  


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