When preparing this week’s update, it struck me that Adient’s situation closely mirrors the
progress we’ve seen reported around the world recently. Specifically, there continues to
be progress in the APAC region following the gradual reopening of China and relatively
stable production in Japan and Korea. Meanwhile, countries across Europe are taking
small but encouraging steps to emerge from the outbreak. And in the Americas, U.S.
governors and the federal government are working on plans to restart businesses and
reinvigorate the economy.
In the same way, Adient is taking action and seeing promising signs. Our restart plan is
underway in China, where OEMs such as BMW, Daimler, Toyota and Tesla are
performing well. In another hopeful sign, most OEMs in that region have forecasted
substantial recoveries in Q2 2020. In the EMEA region, nine Adient plants are scheduled
to restart on April 20, 21 and 22. In the Americas, our current restart date is April 27 for
both the Saltillo and West Point plants.
While there are regional differences in restart plans, our commitment to employee health
and safety is universal. We have refined and implemented rigorous hygiene measures in
preparation for resuming operations. We have established global standards that ensure
the safety of employees as well as our ability to meet our customers’ expectations. I will
share details from our “Return to Work Playbook” with you next week.
I’ve talked a lot about restart plans for our plants, but many of you have asked when our
non-manufacturing sites will reopen. We continue to comply with governmental guidelines
regarding our offices and will reopen them when each country or state relaxes its
restrictions. In the meantime, those employees who can perform their work remotely may
continue to do so.
While we prepare for production to restart, it is more important than ever to reassure our
customers that Adient is their strong partner. One way we are doing this is by intensifying
our VAVE efforts to help our customers drive down variable costs. In the last week, I have
personally sent letters to all of our major customers explaining our commitment to working
with them to continue project momentum and optimize value for the ultimate consumer.
Included in these letters are ideas from the Adient team that have the potential to achieve
significant shared annualized savings. This proactive approach and our innovative ideas
have been very well-received by our customers.
Our VAVE efforts are being recognized externally as well. An editor from AutoBeat Daily
recently visited our Plymouth technical center and talked with Todd Janke and his team. You
can read the resulting article here: https://connect.adient.com/sites/connect/news/Pages/AVisual-Pursuit-of-Value-at-Adient.aspx
As we focus on restart, we should remember that some of our teams have worked
throughout the crisis. Our Pilot JIT plant in Trencin, Slovakia, continues to run uninterrupted.
Although they have fewer employees working due to demand, they are still servicing BMW,
Porsche and Daimler with DV builds and supporting engineering with emphasis builds.
Our Burton plant’s Spare Parts Centre continues to service Ford and JLR with spare parts
during the crisis, ensuring nothing has been missed for our customers.
Our Americas service center in Winchester, Kentucky, has continued to operate throughout
the outbreak as well; it is currently operating at 50% due to the reduction in orders from
dealers. I want to thank all the employees at these facilities for their continued service in a
challenging environment.
Other Adient teams are hard at work using their expertise to support local communities and
our customers through medical manufacturing initiatives. I detailed some of these last week,
but since then, the EMEA team has received a request from Renault for three million mouth
and nose coverings. They delivered the first 150K on April 10, and another 850K will be sent
to the customer on April 24. Thank you to all the teams who are working on these initiatives
globally for the urgency and innovation you have shown during this crisis.
Last but not least, we continue to explore multiple opportunities to provide financial liquidity
for the near and long-term health of our business. More on this in the coming weeks.
May you and your families stay safe and healthy.
Doug Del Grosso
President and CEO