E-Z-GO 2004 Annual Report Download - page 24

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Cessna now has six models in its single engine piston product line: the four-place 172 Skyhawk, 172 Skyhawk SP, 182 Skylane
and Turbo 182 Skylane, and the six-place 206 Stationair and T206 Turbo Stationair. In 2004, certification of the Garmin 1000
(“G1000”) avionics package was completed for all models other than the 172 Skyhawk, and aircraft deliveries commenced with the
G1000 installed. Certification of the G1000 avionics package for the Skyhawk is expected in 2005. By the end of 2004, Cessna had
delivered 5,582 single engine piston aircraft since deliveries were restarted in 1997, marking the delivery of the 150,000th single
engine aircraft since Cessna aircraft production began. Reliability and product support are significant factors in the sale of these
aircraft.
The Citation family of aircraft is currently supported by a total of 10 Citation Service Centers owned and operated by Cessna, along
with authorized independent service stations and centers in more than 16 countries throughout the world. In 2004, Cessna opened
new Citation Service Centers in Orlando, Florida, and Wichita, Kansas, increasing Cessna’s hangar capacity for aircraft service by
42%. The Wichita Citation Service Center is the world’s largest general aviation maintenance facility. The Cessna-owned Service
Centers provide customers 24-hour service and maintenance. Cessna Caravan and single engine piston customers receive prod-
uct support through independently owned service stations and 24-hour spare parts support through Cessna.
Cessna markets its products worldwide primarily through its own sales force, as well as through a network of authorized indepen-
dent sales representatives, depending upon the product line. Cessna has several competitors in the business jet market. Cessna’s
aircraft compete with other aircraft that vary in size, speed, range, capacity, handling characteristics and price.
Cessna engages in the business jet fractional ownership sales through a joint venture with TAG Aviation USA, Inc., a worldwide
aircraft management and charter enterprise. This joint venture, called CitationShares, began in late 2000 and offers shares of Cita-
tion aircraft for operation in the entire contiguous United States. On June 30, 2004, Cessna acquired an additional 25% interest in
CitationShares for a total ownership interest of 75%. CitationShares achieved Part 135 status and is currently offering its cus-
tomers the ability to purchase jet aircraft charter time in advance through the Vector card program.
Fastening Systems Our Fastening Systems segment, Textron Fastening Systems (“TFS”), offers a full range of fastening technologies – which include
Segment fasteners, engineered assemblies and automation equipment – to global customers in the aerospace, automotive, computer, con-
struction, electronics, electrical equipment, industrial equipment, non-automotive transportation, telecommunications and white
good markets. Its customers are global and regional original equipment manufacturers, contract producers, component manufac-
turers and distributors. TFS provides products, services and solutions that simplify manufacturing processes and maximize effi-
ciencies resulting in lower total system costs to its customers. Revenues of TFS accounted for approximately 19%, 18%, and 16%
of our total revenues in 2004, 2003 and 2002, respectively.
TFS is headquartered in Troy, Michigan, and has facilities located in the following 17 countries: Australia, Austria, Brazil, Canada,
China, France, Germany, Italy, Japan, Korea, Malaysia, Mexico, Singapore, Spain, Taiwan, the U.K. and the U.S.
TFS took significant steps in the completion of its global restructuring activity during 2004, including the consolidation of produc-
tion from three plants in Michigan and Illinois, primarily into a refurbished 300,000 sq. ft. facility in Greenville, Mississippi. By
October, the plant had begun production for customers.
Capping a sequence of new-product introductions, TFS launched the Intevia intelligent fastening technology through a license
agreement with Telezygology Inc. (“TZ”), a wholly owned subsidiary of TZ Limited. The agreement provides TFS exclusive global
rights to develop, commercialize and manufacture products using TZ-developed proprietary intelligent fastening technology.
TFS produces engineered threaded fasteners, fastening automation and installation tools, cold formed components, engineered
and laser welded assemblies, blind fastening systems and metal stampings. TFS’ Full Service Provider approach integrates its
product offering with supply chain management services such as vendor managed inventory programs, plant provider programs
and global sourcing. TFS provides a wide range of design and engineering services to its customers, and also derives a portion of
its revenue from licensing selected intellectual property assets to third parties.
TFS has hundreds of competitors in the global fastener market, in essentially three tiers: global multinationals with a global market
presence, typically strong in a market or in one or more product lines; mid-sized regionals with some global activity but primarily
focused on regional markets; and small local firms with a limited range within a particular product category. Competition is based
Textron Inc.