DETROIT -- Behr America Inc., a supplier of engine cooling and vehicle heating and air conditioning systems, said its recovery is under way. Sales could return to pre-recession levels in 2012 and profits even sooner.
CEO Heinz Otto said the suburban Detroit company could post a profit as early as 2011, ahead of plan. "The market is better than we thought," he told a media roundtable.
Behr America posted sales of $554 million last year, compared with $830 million to $870 million during the pre-recession years of 2003 through 2007.
Otto said the rapid decline in the North American auto market, followed by the rapid recovery for Behr, have been the biggest surprises of his 11 months with Behr.
"We're now opening up a little bit from survival mode," he said.
Otto, 60, previously was CEO of German supplier KSB AG, which makes pumps, valves and hydraulic systems.
Three waves of staff cuts pushed Behr America's total North American employment to 2,200, down from almost 2,900 in 2007.
Customer orders continue to grow, and Behr has virtually no excess capacity, Otto said, because "my customers are at maximum capacity."
While the supplier's medium- and heavy-duty truck market remains depressed, demand for cooling systems for turbochargers has soared as automakers turn to turbos to boost the output of fuel-efficient small engines.
Behr also has been moving into the electric-vehicle market as a supplier of cooling systems for battery packs. For example, it will provide the cooling system for the Chevrolet Volt.
Future growth is tied to market growth, Otto said.
Whereas the company had been positioning itself to grow to sales of $1 billion, its restructuring positioned it to break even at just $700 million in sales, he said.
Behr's restructuring included:
-- Eliminating about 200 salaried employees and reassigning much development work to Behr Engineering Services in Pune, India.
-- Shifting production of small labor-intensive components to Mexico from its Dayton, Ohio, plant.
Behr America entered the North American light-vehicle market with its 2002 purchase of Chrysler Corp.'s Dayton thermal products plant.