QUOTE AND NEWS
Automotive World  Jun 8  Comment 
Freddie Holmes speaks to ZF TRW’s Steve Peterson about the mega supplier’s approach to vehicle safety in a world where safety technology is converging The post Passive safety has become ‘adaptive’, says ZF TRW appeared first on...
Automotive World  May 18  Comment 
ZF TRW, the active and passive safety division of ZF Friedrichshafen AG, has today announced that it will start production of its innovative heated steering wheel technology (Conductor Insert Heating System, or CIHS) with a major European vehicle...
Automotive World  Apr 13  Comment 
ZF TRW’s Aine Denari speaks to Automotive World about technology leadership, strategic partnerships and the multi-billion dollar integration of TRW into ZF. By Freddie Holmes and Martin Kahl The post ZF TRW gunning for safety leadership...
Automotive World  Apr 12  Comment 
Latest model INSTRON® Servo S Latest generation dummy calibration devices Advanced front and side impact testing Extends comprehensive safety system engineering equipment already in place ZF TRW, the active and passive safety division of ZF...
The Hindu Business Line  Mar 27  Comment 
Auto components maker Napino Group firm Vishnu Vaibhav Industry has tied up with Germany’s ZF TRW Global Body Control Systems (BCS) to supply four-wheeler switches for automobile manufacturers in Ind...
Automotive World  Feb 22  Comment 
Reaches first-ever disc brake industry milestone – it is estimated that more than half the world’s cars are now fitted with a Colette-based design caliper Pursues performance, efficiency and light-weighting enhancements Continues leadership in...
Automotive World  Feb 4  Comment 
Electric Park Brake (EPB) technology to launch in India for the first time, starting production in 2017 Enhances brake system performance, driver safety and comfort ZF TRW offers full portfolio including standard EPB, integrated EPB and EPB for...
Automotive World  Jan 29  Comment 
New building located in Detroit suburb of Farmington Hills will serve as ZF TRW Global Electronics Headquarters Will house more than 600 electronics experts with full component and vehicle testing capability across the driver assist, occupant...
Automotive World  Jan 27  Comment 
The supplier is narrowing its focus on vehicle efficiency, advanced safety and electrification technologies, writes Freddie Holmes The post ZF TRW gets lean with sale of fasteners business appeared first on Automotive World.
Automotive World  Jan 25  Comment 
Business will be sold to Illinois Tools Works (ITW), a significant manufacturer of fasteners and components, for approximately $450 million USD Operates in all major regions with 3,500 employees worldwide Sale is expected to be completed in the...
SeekingAlpha  Jan 25  Comment 




 

TRW Automotive Holdings (NYSE: TRW) makes auto parts and is the world's second-largest producer of auto safety components, with a significant share of global sales in 2009. TRW is a leader in the auto safety industry, and it supplies parts to many large auto companies including General Motors (GMGMQ), Ford Motor Company (F), and Volkswagen (VLKAY).[1] In 2009, TRW had total revenues of $11.6 billion, posting a net income of $73 million.

Rising prices for raw materials such as steel can have significant impact on TRW's cost of goods sold (COGS) and can significantly impact earnings. On the other hand, a government mandate that all passenger cars have side airbags by 2012[2] has given TRW's revenues a boost in its Occupant Safety Systems segment. Likewise, a weak U.S. dollar gives TRW's non-U.S. customers more incentive to buy their products, because they are relatively cheaper with a weak dollar.

Company Overview

Business Financials

For 2009, TRW posted total revenues of $11.6 billion, a sharp decline from its 2008 total revenues of $15 billion.[3] Although sales were down across the board for TRW, the biggest difference came in its Chassis segment, where total sales declined $1.7 billion.

Despite the declining revenues, TRW was able to post a net income in 2009 of $73 million in 2009, as opposed to a $780 million loss in 2008. This was largely due to a one time $787 million impairment to TRW's goodwill that was incurred in 2008.[4]

Business Segments

TRW breaks its operations into four segments: i) Chassis, ii) Occupant Safety Systems, iii) Electronics, and iv) Automotive Components.

Chassis Systems (59% of 2009 revenue)

This segment manufactures products for steering, braking, suspension and other applications. Total sales for this segment declined $1.7 billion in 2009 to $6.9 billion.[3] The decrease in sales was driven mostly by lower volume and price reductions provided to customers, which combined totaled $1,246 million.[5] Foreign currency exchange also had a net unfavorable impact on sales of $443 million.

Occupant Safety Systems (25.2%)

Occupant Safety Systems produces safety products related to air bags, seat belts, and vehicle security. This segment's main products include airbags, seat belts, and safety electronics. In 2009, this segment's net sales decreased $901 million to $2.9 billion.[6]

Electronics (7.4%)

The electronics segment had its net revenues decline $320 million in 2009 to $864 million.[3]

Automotive Components (11.5%)

Automotive Components produces components for engines, controls, and fasteners. The company's engine components consist mostly of engine valves. In 2009, total net sales declined by $320 million in to $864 million.[3]

Key Trends and Forces

All passenger cars sold in the U.S. must have side airbags by 2012

In 2007, the National Highway Traffic Safety Administration announced a new regulation under which all cars sold in the United States must have side airbags by 2012.[7] As a result, TRW's Occupant Safety Systems revenue jumped over 9% from $4,326 million in 2006 to $4,714 million in 2007.[8]

TRW's three largest customers accounted for 45.7% of 2009 revenue

TRW is heavily dependent on a few key Auto Makers, as its three largest customers accounted for 45.7% of its 2009 revenue. Volkswagen (VLKAY), Ford Motor Company (F), and General Motors (GM) accounted for 19.1%, 15.6%, and 11.1% of TRW's 2009 revenue, respectively.[1] If any of these customers were to order fewer of TRW's products, go out of business, or start ordering components from a new supplier, TRW would find itself losing a large percentage of its revenue. Sluggish conditions in the U.S. auto market are of particular concern to GM and Ford, two of TRW's largest customers.

Competition

  • Autoliv (ALV) manufactures airbags and seat belts that compete directly with TRW's safety products.[9]
  • Takata Corporation (TYO:7312) also sells airbags, seat belts, and related safety components to auto manufacturers.[10]
  • Key Safety Systems, a private company, also competes with TRW's products in the auto safety industry.[11]
  • Delphi Corporation (DPHIQ) competes with both TRW's safety products and its control products from the Automotive Components segment.[12]
  • Visteon (VC) makes electronic safety and security parts.[13]


References

  1. 1.0 1.1 TRW 10-K 2009 Item 1 Pg. 9
  2. Edmunds: NHTSA Mandates Side Airbag Protection in All Passenger Cars
  3. 3.0 3.1 3.2 3.3 TRW 10-K 2009 Item 7 Pg. 34
  4. TRW 10-K 2009 Item 7 Pg. 26
  5. TRW 10-K 2009 Item 7 Pg. 35
  6. TRW 10-K 2009 Item 7 Pg. 36
  7. Edmunds: NHTSA Mandates Side Airbag Protection in All Passenger Cars
  8. TRW 2007 10-K: Occupant Safety Systems, pg 35
  9. Google Finance: ALV
  10. Business Week: 7312.T
  11. Google Finance: Key Safety Systems, Inc.
  12. Google Finance: DPHIQ
  13. Google Finance: VC
Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki