Visteon announced a financial agreement with Ford Motor Company that will improve Visteon’s operating results and cash flow and strengthen the operations that directly serve the automaker.
The details of the financial agreement are being reported in a Securities and Exchange Commission filing.
“This financial agreement is the right step forward with Ford and supports the operations that directly serve our largest customer,” said Mike Johnston, president and chief executive officer. “The commitments made by Ford and Visteon under this agreement will improve Visteon’s operating results and cash flow. It’s a mutually beneficial agreement that is in the best interest of both companies.”
Under the financial agreement, Ford agreed to reduced wage reimbursements from Visteon for hourly Ford-UAW employees assigned to Visteon facilities; accelerate payment terms to Visteon; and pay for capital expenditures at certain Visteon plants in North America. Visteon agreed to continue uninterrupted supply to Ford and to comply with contractual agreements with Ford and the UAW.
On Sept. 9, 2004, Visteon announced it would explore strategic and structural changes to its US business to achieve a sustainable and competitive business model. Such changes would include Ford and Visteon’s legacy businesses.
The discussions with Ford are progressing positively. The goal is to ensure the long-term competitiveness of Visteon and a continued supply of components to Ford, while being mindful of obligations to the Ford-UAW employees assigned to Visteon.
“We are spending a great deal of time working with Ford to reach a conclusion,” said Johnston. “For some time now, we have had a concept that both parties are working toward achieving. We are spending our time working out the details of that concept. Other than our conversations with Ford, we are not in active discussions with anyone else.”
Murdok | Breaking eBusiness News
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