Henniges Automotive: Weathering the Storm

The following excerpt is from American Executive, July 2009

With global automotive sales down 30% to 40%, depending on market segment, it’s re-entrenchment time for suppliers to automotive manufacturers. Rather than slashing product lines and staff, however, executives at Henniges Automotive continue to work on improving work processes, gaining efficiency, and bringing new products to the market.

Henniges Automotive, begun in December 2007 through the merger of Metzeler Automotive Profile Systems-North America (MAPS) and GDX Automotive, has trimmed its inventory levels by more than 30%, said Rob DePierre, CEO of the Farmington Hills, Mich.-based tier-one supplier.

That move frees up cash, reduces the level of volatility in production, and lessens the likelihood of being caught with excess inventory. “We manage inventory weekly, and the amount we carry continues to drop as we streamline processes,” DePierre said.

In another cost-cutting move, up to 50% of the company’s salaried employees (including DePierre) were furloughed over three months beginning in May after Chrysler declared bankruptcy and General Motors drastically reduced its output. Both of these big-three automakers are Henniges’ customers, as are Ford Motor Co., Volkswagen, BMW, and Daimler.

“What we haven’t stopped doing is trying to delight the customer,” said DePierre. “We’re trying to partner with customers and do more for them. We’ve also continued to invest in innovation and are bringing out new products.”

Henniges Automotive manufactures sealing systems, glass encapsulation systems, and modular systems such as integrated glassrun and quarterlight systems, backlight modules, liftgate systems, and obstacle detection systems. The company came into being after private equity firm Wynnchurch Capital purchased MAPS and GDX in 2007. DePierre was hired away from Benteler Automotive, where he worked for more than two decades, to run the combined company. The name was taken from GDX’s most-recognized brand, which was founded in Germany by Ernst Henniges in 1951.

“Both companies manufacture sealing systems that keep out noise, dust, and rain, but Metzeler was more North American-based while GDX was more global with significant operations in Europe and Asia,” DePierre said. “As the automotive industry continues its globalization, an OEM can deal with one company to supply sealing systems wherever manufacturing facilities are located.”

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