Chrysler 2007 Annual Report Download - page 83

Operating Performance
Against the backdrop of a reference market that expanded 5.4%
during 2007, Magneti Marelli increased its revenues by 11.7%
on a comparable consolidation basis.
In line with its growth objectives, Magneti Marelli resumed control
over the marketing and distribution activities of automotive spare
parts, diagnostic equipment and services for electrical and
electronic systems, powertrains, bodywork and consumables. The
new business line set up for this purpose, After Market Parts and
Services, was consolidated effective May 1, 2007.
The Sector signed a number of major agreements in 2007
which will support its growth in strategic new markets.
In June, Magneti Marelli and Russia’s Avtopribor, a supplier
of electronic and mechanical components, entered into an
agreement to design, develop, manufacture and market
electronic instrument clusters for motor vehicles.
In September, Magneti Marelli signed a memorandum of
understanding with Chery Automobile Co. Ltd for the creation
of a joint venture in China that will produce hydraulic
components for the Selespeed AMT transmission, which will
be used by Chery and other car makers.
In October, the Magneti Marelli Powertrain India Private
Limited joint venture was set up between Magneti Marelli
Powertrain, which holds a 51% interest, and Suzuki Motor
Corporation with Maruti Suzuki India Limited, which together
hold a 49% interest. The new company will produce electronic
control units for diesel engines in India.
As part of its plans to develop in emerging markets, realisation of a
plant for the production of instrument panels, on-board equipment
and electronic components began in Slovakia and production
startup is expected to take place before the end of 2008.
Highlights of the performance of each business line are
outlined below.
Lighting
Revenues totalled 1,614 million euros in 2007, up 15.1% from
2006. Most of this increase was due to stronger Original
Equipment sales. Volumes rose in all of the business line’s
major markets – Germany, the NAFTA area and Brazil – while
growth was also significant in Turkey and China.
Sales to third parties were a significant factor in the year’s
performance: new products supplied to Volkswagen-Audi,
featuring the world’s first application of a headlamp unit using
LED technology for all required functions, and to General
Motors enabled the business line to carve out an even larger
share of the worldwide headlamp market.
During the year, work continued on the development of taillamps
using LED technology for all required functions and on the
application of the Light Guide, highly uniform light guides.
Significant new orders were received during the year for
headlamps and taillamps from Renault and Volvo, and for
headlamps for the new Lancia Delta HPE, as well as for BMW
and Mercedes models.
Engine Control
Revenues for 2007 totalled 947 million euros, an increase of 7.3%
from the previous year. Products showing the strongest growth
included Selespeed systems and GDI gasoline direct injection units
in Europe, complete systems in Brazil, and manifolds in China. The
business line’s rising revenues were due to Fiat Group
Automobiles and FPT Powertrain Technologies, as well as third
parties. In addition, commercial relations were initiated with the
Suzuki and Mitsubishi customers.
New launches for the year included the 1.2 litre spark ignition and
1.3 litre diesel systems for the new Fiat 500, while major
achievements in product development included applications of
the Pico Eco (in Brazil) and new injection systems for
Report on Operations Magneti Marelli
Components — Magneti Marelli
82
Highlights
(in millions euros) 2007 2006
Net revenues 5,000 4,455
Trading profit 214 190
Operating result (*) 209 175
Investments in tangible and intangible assets 319 293
- of which capitalised R&D costs 92 77
Total R&D expenses (**) 221 210
Employees at year-end (number) 27,962 25,195
(*) Including restructuring costs and unusual income (expenses).
(**) Including R&D capitalised and charged to operations.