Companies Form Joint Venture to Supply Exhaust Products
LAKE FOREST, ILLINOIS, November 24, 2003 - Tenneco Automotive (NYSE:TEN) announced today that the company has signed a joint venture agreement with China-based Chengdu Lingchuan Mechanical Plant to establish Chongqing Walker Exhaust System Co., Ltd. The new joint venture will supply emission control products and systems to Changan Ford Co. Ltd., the joint venture between Changan Automobile Group Company and Ford Motor Company.
Tenneco Automotive will have 60 percent ownership of the joint venture, which will be based in Chongqing and initially supply exhaust products for the China-produced Ford Mondeo. Subject to receipt of governmental approvals and other customary conditions, the company expects the joint venture company to be formally established by the end of this year and to begin production in 2004.
"We are very pleased to announce another joint venture in China, which represents the continuing expansion of our operations in this dynamic market," said Mark P. Frissora, chairman and CEO, Tenneco Automotive. "Ford is one of Tenneco Automotive's largest global customers and we look forward to growing our relationship in China."
In connection with entering into the joint venture agreement, the company and Lingchuan also entered into a memorandum of understanding to explore further joint venture cooperation involving Lingchuan's existing exhaust operations in Chengdu, China. If the parties agree to this further cooperation, it would give the company access to additional customers including Changan Automotive Co. Ltd. and Changan Suzuki Automotive Co. Ltd.
Tenneco Automotive established its first joint venture in China in 1995 and is currently the largest exhaust manufacturer in China. In addition to the joint venture with Lingchuan, the company has joint venture operations in Shanghai, Dalian and Beijing as well as a just-in-time manufacturing facility in Changchun. The company reported 87 percent year-over-year revenue growth in China for the first six months of 2003.
Tenneco Automotive is a $3.5 billion manufacturing company with headquarters in Lake Forest, Illinois and approximately 19,600 employees worldwide. Tenneco Automotive is one of the world's largest producers and marketers of ride control and exhaust systems and products, which are sold under the Monroe® and Walker® global brand names. Among its products are Sensa-Trac® and Monroe Reflex® shocks and struts, Rancho® shock absorbers, Walker® Quiet-Flow® mufflers and DynoMax® performance exhaust products, and Monroe® Clevite® vibration control components.
This press release contains forward-looking statements. Words such as "will," "establish," "expects," "continuing," "explore" and similar expressions identify forward-looking statements. These forward-looking statements are based on the current expectations of the company (including its subsidiaries). Because these forward-looking statements involve risks and uncertainties, the company's plans, actions and actual results could differ materially. Among the factors that could cause these plans, actions and results to differ materially from current expectations are: (i) the general political, economic and competitive conditions in markets and countries where the company and its subsidiaries operate, including currency fluctuations and other risks associated with operating in foreign countries; (ii) changes in automotive manufacturers' production rates and their actual and forecasted requirements for the company's products, including the company's resultant inability to realize the sales represented by its awarded book of business; (iii) changes in consumer demand and prices, including decreases in demand for automobiles which include the company's products, and the potential negative impact on the company's revenues and margins from such products; and (iv) the timing and occurrence (or non-occurrence) of transactions and events which may be subject to circumstances beyond the control of the company and its subsidiaries. Other factors that could cause the company's plans and results to differ materially from current expectations are described in the company's annual report on Form 10-K for the year ended December 31, 2002, to which you are referred for additional information. The company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this press release.
Tenneco Automotive, Media Relations
(1) 847 482 5607
Tenneco Automotive, Investor Relations
(1) 847 482 5042