PARIS - Faurecia will decide within 12 months if it will sell its interiors business, says Chairman Daniel Dewavrin.
Dewavrin will step down after a shareholders meeting in May. He will remain on the board but will be replaced as chief executive by Pierre Levi.
'We do not have the critical size in vehicle interiors,' Dewavrin said. 'To reach this size by internal growth takes too long. Either we grow externally, or we will have to split off (the division). A decision should be made in the next 12 months.' Faurecia's interiors division includes instrument panels and plastic door panels but not its core seating business.
Dewavrin's retirement was announced as Faurecia reported 1999 results. The company posted sales of euros 4.26 billion - an 8.2 percent increase over 1998. Net income rose 80 percent to euros 56.2 million.
Last year, the company signed a $500 million seating contract with General Motors, and bought U.S. exhaust maker APAS for $340 million.
Dewavrin is targeting a better-than-50-percent increase in sales to euros 7.12 billion in 2004. By that time, GM will be Faurecia's third-largest customer, with 15.9 percent of sales, behind PSA/Peugeot-Citroen (24.4 percent) and Volkswagen (21.5 percent) and ahead of Renault (14.4 percent). Fifteen percent of Faurecia's sales then would be in the United States. They were 3.8 percent last year.
But these plans depend on growth. Dewavrin said he hopes the division grows and remains within the group.
He also said the front-end module business needed to grow, but this was not dependent on acquisitions. 'The front-end module market will grow. We will double sales within five years. So selling this business has not been on our agenda,' Dewavrin said.
Seats accounted for 66 percent of sales in 1999, and exhaust systems made up 17 percent of sales.
