WARREN, Ohio, April 25, 2011 /PRNewswire/ -- Stoneridge, Inc. (NYSE: SRI) today announced that it has executed an agreement to manufacture certain electronic products for its largest customer, Navistar, in a new facility located in Ramos Arizpe, Mexico, near the city of Saltillo.
The new facility will allow Stoneridge to further support and strengthen its relationship with Navistar by producing critical components in a highly cost-efficient manner, as well as enable the Company to more competitively bid on other customer projects over the next two to three years. The Company also expects to utilize this new leased facility, which is approximately 145,000 square feet, for additional production requirements.
Plans call for production at the new facility to commence in August 2011 for certain wiring and instrument panel applications, with additional applications to be produced through the fourth quarter of 2011 and into the first quarter of 2012. Stoneridge expects costs associated with the start-up to reduce profitability in the second quarter through fourth quarter of 2011 by approximately $4.0 million to $5.0 million and expects capital expenditures to approximate $5.0 million to $6.0 million.
"We look forward to expanding our relationship as a trusted partner to Navistar as this project was an important consideration included in the five-year agreement we signed with Navistar in July of 2010," said John Corey, president and chief executive officer of Stoneridge. "Along with our new joint venture agreement in India, which we announced on April 19, this reflects our continued progress to broaden our global manufacturing presence and enhance our ability to meet the growing demand from our customers."
About Stoneridge, Inc.
Stoneridge, Inc., headquartered in Warren, Ohio, is an independent designer and manufacturer of highly engineered electrical and electronic components, modules and systems principally for the medium- and heavy-duty truck, automotive and agricultural and off-highway vehicle markets. Additional information about Stoneridge can be found at www.stoneridge.com.
Statements in this release that are not historical fact are forward-looking statements, which involve risks and uncertainties that could cause actual events or results to differ materially from those expressed or implied in this release. Things that may cause actual results to differ materially from those in the forward-looking statements include, among other factors, the loss of a major customer; a significant change in medium- and heavy-duty truck, automotive or agricultural and off-highway vehicle production; disruption in the OEM supply chain due to bankruptcies; a significant change in general economic conditions in any of the various countries in which the Company operates; labor disruptions at the Company's facilities or at any of the Company's significant customers or suppliers; the ability of the Company's suppliers to supply the Company with parts and components at competitive prices on a timely basis; customer acceptance of new products; and the failure to achieve successful integration of any acquired company or business. In addition, this release contains time-sensitive information that reflects management's best analysis only as of the date of this release. The Company does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release. Further information concerning issues that could materially affect financial performance related to forward-looking statements contained in this release can be found in the Company's periodic filings with the Securities and Exchange Commission.
SOURCE Stoneridge, Inc.