DETROIT- Richard E. Dauch has a lot riding on General Motors.
The American Axle & Manufacturing Holdings Inc. CEO said a contract to supply a new GM driveline system could be worth more than $1.5 billion annually - about half the company's $3.1 billion in revenue last year - and could extend to 2015.
The company also is testing a four-wheel steering component of a module that could add significantly to the Detroit supplier's sales if GM agrees to use it, Dauch told shareholders during the annual meeting here last week. He declined to identify the GM program, but it is believed to be for the next generation of full-sized pickups and large sport-utilities.
"This is the largest driveline-system award program by any vehicle manufacturer in the world," he said. "It will secure our revenue (from 2006) through 2015 with this one program. That is how important it is."
American Axle was ranked by Automotive News as the 11th largest North American supplier in 2001. The company was formed in 1994 from the spinoff of GM plants.
GM selected the company as Tier 1 integrator for the program. American Axle would be responsible for both axles, driveshaft, brake components, suspension parts, and the design and sourcing of the driveline system.
Dauch's plan to offer a rear-steering module could place his company in competition with another GM spinoff, Delphi Corp. of Troy, Mich. Delphi supplies GM with a four-wheel steering system known as Quadrasteer. The system combines conventional front-wheel steering with an electrically powered rear-wheel steering system. Dana Corp. of Toledo, Ohio, provides the rear axle for Delphi.
"It's no threat to us," Dauch said after the meeting. "It's still low-volume, and it will be surpassed by the technology of the next generation."
He said American Axle's version will offer a different design and packaging and suggested it would cost less. Quadrasteer is standard on the GMC Sierra Denali pickup but is expected to be offered as an option on some 2003 models of other heavy-duty pickups and the full-sized Chevrolet Suburban and GMC Yukon XL sport-utilities.
The succession of new-business awards, including those from Ford Motor Co. and DaimlerChrysler, has boosted American Axle's share price 69 percent this year. The shares were up 169 percent last year. The shares closed Thursday, May 16, at $34.88, up from a 52-week low of $10.15.