Self-confidence and optimism marked last week's presentation of the 1996 directors' report and the future strategies of SAI Automotive AG (HQ: Friesstr. 26, D-60388 Frankfurt) – previously Sommer-Allibert Industrie AG – by the company's managing director, Marc Assa. He emphasised before the press that SAI has almost completed the structural change towards becoming a supplier of automobile parts and accessories only, with registered office in Germany. In 1996 the consolidated turnover increased by 38% to DEM 1.7bn. In Germany, a 40% increase in turnover to DEM 759m was achieved, mainly as a result of the takeover of the plastics moulding production from Mercedes-Benz in the Wörth factory near Karlsruhe. SAI now carries out most of its development and design activities here. The volume of production comprises about 500,000 dashboards for the C and S series. Foreign turnover grew by 36% to DEM 942m, and the result after tax increased by 11% to DEM 40.8m.

In the home furnishings division, SAI had a decrease in turnover of DEM 70m in 1996. The sanitary products division has now been sold. Assa expects a turnover of DEM 2.2bn this year; this figure will include the turnovers of Lignotock in Germany and Great Britain, amounting to about DEM 300m, for the first time. After the inclusion of the French automobile parts and accessories factories – which is planned for 1997 – SAI's turnover will come to about DEM 3b. Assa said, "With comparable figures, we expect growth of 10% in 1997". This volume of turnover means that SAI is easily the largest European supplier of interior fitments for the automobile industry. In Europe there are currently no serious competitors in sight, according to Assa. The situation is somewhat different in North America with competition from the giants Johnson Controls (USA) and Magna (Canada).

SAI's strategy includes a systematic internationalisation plan which is now shifting its focus from Europe to North and South America. The top priority for the immediate future is the American market, where SAI currently has four factories and expects a turnover of more than DEM 200m in 1997. Assa confirmed that the company is still on the lookout for partners in order to adjust the turnover volume to the size of the market. Attention is also being directed to Central and South America. In Mexico, a factory for dashboards and door trims for Volkswagen will begin production in the second half of 1997 and is expected to reach an annual turnover of over USD 100m when fully operational. In Brazil, SAI has entered into a joint venture with a Spanish partner to produce textile and plastic parts. In view of the fact that experts have estimated automobile production at 3m units per year in Brazil alone by the year 2002, SAI is prepared to carry out other projects in South America.

A particularly important element of SAI's strategy is the concept of the "global budget". This means that all interior fitments can be supplied to automobile manufacturers worldwide by just the one company. The global budget concept covers design and development, the manufacture of prototype moulds and the mass production of parts. According to Assa, 12 vehicles are currently equipped on this principle, making the company the market leader worldwide. In response to a question from PIE, he said that SAI will continue to supply bumpers separately but that this will not be part of the systems strategy.

READER SERVICE: More details on SAI's business in 1996 and its strategies (German): PIE-No. 40768.