American Axle CEO Has Eye on Delphi: Some Units Would Fit Well, Exec Says

Detroit Free Press

TRAVERSE CITY, MI — Dick Dauch, CEO of American Axle & Manufacturing Holdings Inc., said Wednesday that parts of auto supplier Delphi Corp., which is in bankruptcy, would fit with his company’s business model.

Just before his speech at the Management Briefing Seminars in Traverse City, MI, Dauch told the Free Press he hopes Delphi reaches a resolution with General Motors Corp. and its unions.

Delphi is to have a bankruptcy court hearing Friday in New York, and it will continue its request to cancel union contracts and eliminate retiree medical and life insurance benefits. Delphi’s unions have promised a costly strike if labor contracts are voided.

"We’re all hoping to find some harmony because that’s what we need right now," said Dauch.

American Axle supplies driveline systems and related powertrain components and chassis modules for light trucks, SUVs, passenger cars and crossover vehicles. Its driveline and drivetrain systems include parts that transfer power from the transmission to the wheels, such as axles, chassis modules and crankshafts.

Lindsey Williams, a spokesman for Delphi, declined to comment on American Axle’s interest in its units. Delphi, which makes everything from radios to radiators, is looking to sell off businesses that make what it considers to be commodity products. Since filing for Chapter 11 bankruptcy protection Oct. 8, the company has divested its spark plug division. Troy, MI-based Delphi, the nation’s largest auto-parts supplier, said March 31 it plans to close or sell 25 of 33 U.S. plants, many of which make products American Axle would sell.

In an Oct. 21 interview with the Free Press, Delphi CEO Steve Miller said that, before Delphi could attract buyers for those plants, it has to tame its labor costs, which it is doing through bankruptcy.

"There are pieces that would fit with us," Dauch said of Delphi’s businesses. "We could bolt them on to us."

Dauch declined to discuss details of his interest in Delphi, but he said he’s not looking to make a rush decision.

American Axle and Delphi were once parts of GM. Dauch co-founded American Axle in 1994 by teaming with investors to buy GM’s axle, forge and driveline assets. Delphi was spun off from GM in 1999.