MAUMEE, Ohio — Dana has taken action to become a full-service provider of driveline systems in the growing South American commercial vehicle business.
The company recently completed a strategic transaction with SIFCO S.A., a leading producer of steer axles and forged components in South America, which enables Dana to add truck and bus steer axles to its product offering in South America. Dana said the move effectively positions the company as the leading full-line supplier of commercial vehicle drivelines – including front and rear axles, drive shafts and suspension components.
This latest transaction is consistent with Dana’s emerging market strategy and addresses strong customer demand for a complete driveline product offering in the region.
Under the agreement, Dana acquired the distribution rights of commercial vehicle steer axle systems and is now responsible for all customer relationships, including marketing, sales, engineering and assembly. Key customers in the Brazilian commercial vehicle market include Agrale, Ford, Iveco, MAN, Mercedes Benz, Scania and Volvo.
Dana obtained an exclusive, long-term supply agreement with SIFCO to ensure supply of key components in the systems – specifically I-beams, steer arms and knuckles. In addition, SIFCO will provide selected assets and assistance to Dana to establish, in the near term, assembly capabilities for these systems.
Dana has invested $150 million to acquire the rights to the business, which is expected to generate $350 million in annual revenue, taking Dana’s total annual revenue in South America to more than $1 billion and positioning the company for further growth in the region. Total units sales of commercial vehicles in Brazil totaled 248,000 in 2010.
The financial impact of the transaction will be recorded in the first quarter of 2011.
