Chrysler 2006 Annual Report Download - page 40

Work on product development focused on newly launched
models such as the Bravo, New Ducato, new Fiat 500 and other
models for PSA. In terms of innovation, the business unit
worked on projects associated with an evolved version of
the Torcs suspension and the program for the electronic SDC
Synaptic Damping Control system.
Major orders for shock absorbers were booked in 2006 from
Tofas in Turkey, Renault in Romania, Fiat, Volkswagen, General
Motors and PSA in Brazil, and General Motors in the United
States. In Europe, the unit was awarded an order for the
complete suspension system on the new Fiat 500.
Electronic Systems
Total revenues for 2006 amounted to 534 million euros,
up 4.1% from 2005.
Fiat and PSA continued to be the Electronic Systems business
unit’s largest customers, with a significant increase being
recorded for Fiat (+28%). As for third parties, there was a sharp
increase in sales to the Volkswagen-Audi group (+50% from 2005).
In 2006, new products were introduced around the world,
including instrument panels for Fiat, Volkswagen and Audi,
antenna modules for Volkswagen and Renault, and a
navigation system for PSA.
Orders were received for the new generation of navigation
systems for PSA and SAIC, the Fiat radio/navigation system,
and instrument panels for Audi and Renault.
Exhaust Systems
In 2006, revenues totalled 533 million euros, a significant
increase of 31.9% from the previous year.
This sharp rise in revenues was fuelled by sales to Fiat and
Mercedes, where the latter was supplied with exhaust systems
featuring a DPF diesel particulate filter. Sales also increased in the
Mercosur, thanks to strong demand from local customers.
Major production startups included systems for the Fiat Bravo and
New Ducato, and the cold-end exhaust system for Volkswagen.
New orders booked include the DPF system for the 1.3 small
diesel engine of Fiat Powertrain Technologies.
Motorsport
Magneti Marelli participates in the major motorsport
championships as a technical partner. In 2006, it supplied
electronic control systems, fuel system and electromechanical
components, and telemetry and data acquisition systems to the
leading Formula 1 teams. In addition to Formula 1, Magneti
Marelli is also active in other championships. It participates in
the World Rally Championship, supplying electronic control
systems to various teams, and in the Moto GP championship,
where it provided fuel injection and electronic systems to
Yamaha, Ducati and Kawasaki. Magneti Marelli also helped
bring Maserati to victory in the FIA GT1 championship.
Report on Operations Magneti Marelli 77
Operating Performance
Against the backdrop of a market that expanded 4.3%, Magneti
Marelli increased its revenues by 14.2% on a comparable
consolidation basis.
The major orders booked for new car models will enable
the Sector to further diversify its customer portfolio.
In the first half of 2006, the Sector sold to Fiat Auto S.p.A.
and Sata S.p.A the manufacturing and assembly activities
of the Suspension Systems earmarked for Fiat models. These
activities are carried out at the Cassino, Pomigliano d’Arco,
Melfi and Mirafiori plants.
Highlights of the performance of each business unit are
outlined below.
Lighting Group
In 2006, revenues totalled 1,402 million euros, up 11.2% from
2005.
In 2006, approximately 80 new production programs were
launched which, together with the positive sales performance
of current products, enabled Magneti Marelli to achieve
significant market shares worldwide for both headlamps (14%)
and taillamps (13%).
In terms of innovation, LED headlamps and taillamps are now
being developed, together with a new concept in optical lenses
for future generations of low-beam headlamps and the world’s
first design for a headlamp unit using LED technology for all
required functions. Reliable manufacturing processes,
competitive prices and high quality standards have enabled the
business unit to maintain excellent relationships with car
makers and attract new orders.
Positive developments in this area included the orders received
from Renault Nissan, and the start of commercial dealings with
Suzuki: an important launching pad for entry onto
the Japanese market.
Report on Operations Magneti Marelli76
Powertrain (Engine Control)
Revenues for 2006 totalled 882 million euros, an increase of 11.9%
from the previous year. As regards the product mix, demand for
spark ignition engine systems slowed in favour of their diesel
counterparts.
The revenue increase involves all customers of the business line,
in particular Fiat Auto and Fiat Powertrain Technologies (for a
total of +22%) and customers in the China area. Good sales
performance was also achieved by the Tetrafuel system (which
enables environmentally-friendly vehicles to run on four fuel
types) which combines the ability to meter four types of fuel in a
single control unit, supplied to Fiasa in Brazil. A number of major
product launches also took place, including that for mechatronic
Selespeed systems for PSA and GM-Opel in Europe and for
Chery in China.
Orders received during the year included the Selespeed
applications and gasoline systems for Chery, the gasoline system
for the new Fire engine of Fiat Powertrain Technologies, and
Flexfuel systems for Fiasa, Ford and PSA in Brazil.
Cofap Automotive Suspension
In 2006, the business unit had revenues of 1,103 million euros
(1,052 million euros in 2005), an increase of 20% from the
previous year’sfigure on a comparable consolidation basis.
The increase in volumes is connected to the success of Fiat’s
new models and the introduction of new products for GM-Opel
and PSA.
Components – Magneti Marelli
Highlights
(in millions of euros) 2006 2005
Net revenues 4,455 4,033
Trading profit 190 162
Operating result (*) 175 127
Investments in tangible and intangible assets 293 313
-of which capitalised R&D costs 77 67
Total R&D expenses (**) 217 197
Employees at year-end (number) 25,195 24,213
(*) Including restructuring costs and unusual income (expenses).
(**) Including R&D capitalised and charged to operations.