Dana's Michael Burns: Counting on core axle and driveline business to expand business
Dana will begin production next year to supply the front and rear axles and prop shafts for the redesigned, 2007-model-year Wrangler, say sources familiar with the contract.
The Wrangler deal is valued at $75 million annually.
It is unclear whether Dana also won the contract to supply a Wrangler derivative for either the 2008 or 2009 model year.
Dana CEO Mike Burns is counting on his core axle and driveline business to expand at twice the rate of the vehicle market and lift earnings. The Wrangler contract is only a modest contribution to that plan.
More important is the symbolism. Dana sold 350,000 axle sets to the military during World War II for the military jeep, the precursor to the Jeep Wrangler.
The Toledo, Ohio, supplier has been associated with Jeep axles ever since.
Also, Dana does a brisk business in aftermarket Wrangler parts.
Dana spokesman Gary Corrigan and Chrysler group spokesman David Elshoff declined comment.
Dana Corp. ranks No. 7 on the Automotive News list of the Top 150 suppliers to North America with North American original-equipment automotive parts sales of $5.98 billion in 2004.
Dana's axle contract win follows its loss last year of a contract to build a "hot" rolling chassis, complete with wheels, engine and transmission, for the redesigned Wrangler. Dana still is smarting from its loss to Korean chassis component supplier Hyundai Mobis.
For the 2007 Wrangler, Dana will build the axles and prop shafts and ship them to Mobis, which is building a chassis assembly plant adjacent to Chrysler's Jeep assembly complex in Toledo. Mobis then will assemble the chassis.
The Wrangler plant is part of Chrysler's $2.1 billion investment in its Jeep assembly complex.
Dana builds the front axles, some rear axles and all of the prop shafts for the Wrangler.
Mary Connelly contributed to this report
You may e-mail Robert Sherefkin at [email protected]