Navistar International Opens New Headquarters

Engine and vehicle maker Navistar International Corp. has officially opened its new headquarters in suburban Chicago. According to an Associated Press report, the company said Thursday (Feb. 2) that more than 3,000 people will work at the location in Lisle.

Navistar began moving employees into the campus last year as it moved its headquarters from Warrenville to Lisle.

The state of Illinois provided the company with about $65 million in tax breaks after it agreed to keep its headquarters in Illinois rather than move it to potential sites in Alabama, Texas or South Carolina.

Navistar also consolidated some jobs that had been in Fort Wayne, Ind., at the Lisle campus.

The 87-acre location formerly belonged to Alcatel-Lucent but sat vacant for some time before Navistar began moving in last year.

 

Navistar to Hold Analyst and Investor Day Feb. 1

Navistar International Corp. will host an Analyst and Investor Day on Feb. 1 at the company’s new integrated product development center and headquarters in suburban Chicago.

“At our new facility, you’ll see first-hand the thinking that goes into our products and the value of integrating not only our products, but our people,” CFO A. J. Cederoth said in a press release. “We will provide insights into our strategies – from further global growth to increased expansion into alternative fuels – along with providing specific guidance for 2012.”

Numerous products on display will showcase how the company’s strategy of utilizing one chassis, two bodies and three engine platforms to design integrated, best-in-class vehicles that meet the full-range of customer needs will result in reduced investment, cost efficiencies and continued margin expansion. Navistar is also parent to Monaco RV LLC and Workhorse Custom Chassis Corp.

“Our EGR technology has proven itself in the marketplace and remains the best solution for our customers,” said Jack Allen, president of Navistar’s North American Truck Group. “We are the first and only OEM to offer this customer-centric solution.”

The event will begin at 11 a.m. CST. Attendance in person is limited to analyst and institutional investors, who must preregister via e-mail to investor.relations@navistar.com. A live audio webcast of the event will be available to the public at http://ir.navistar.com/events.cfm.

Navistar 4Q, Year-end Income Soars, Sales Rise

“We are pleased that we have finished the year strong and delivered solid fourth quarter results across all segments,” said Daniel C. Ustian, Navistar chairman, president and chief executive officer. “Not only did we deliver on 2011 commitments, we continued to invest in our strategy and set the foundation for a strong 2012.”

Reported net income for the fourth quarter, ended Oct. 31, was $255 million, equal to $3.48 diluted earnings per share, versus a year-ago net income of $44 million, equal to $0.61 diluted earnings per share. Adjusted net income for the fourth quarter 2011 was $247 million, or $3.37 diluted earnings per share.

Net income for fiscal year 2011 was $1.7 billion, equal to $22.64 diluted earnings per share, versus net income for fiscal 2010 of $223 million, equal to $3.05 diluted earnings per share. Adjusted net income was $402 million, or $5.28 diluted earnings per share. Adjustments impacting both the fourth quarter and fiscal year 2011 include the net impact of an income tax valuation allowance release, costs associated with the restructuring of North American manufacturing operations including Monaco RV LLC and Workhorse Custom Chassis Corp., along with engineering integration and the impact of the Medicare Part D court ruling.

Revenue for the fourth quarter rose 28% to $4.32 billion compared with $3.37 billion in the prior-year period. For the full year, sales were nearly $14 billion versus $12.14 billion the previous year.

In the fourth quarter, the company saw increases in worldwide unit chargeouts in both its traditional North American and global businesses while maintaining a strong market share position. The company purchased 2.7 million shares of its stock in the fourth quarter and ended the year with a manufacturing cash balance of $1.2 billion. Navistar is on track to complete the full $175 million stock repurchase program in early 2012.

“We expect the industry to continue its steady recovery,” said Ustian. “We will continue to leverage our market leading North American businesses, invest in new products and expand further into global markets, while effectively controlling our costs.”

For the complete report click here.

 

 

Navistar to Locate Workhorse Operations in Ohio

Navistar International Corp. will move production for its Workhorse Custom Chassis Corp. subsidiary to a facility in Springfield, Ohio. As reported by the Springfield News Sun, Navistar closed down the Workhorse plant in Union City, Ind., this year.

The Springfield plant will transition the Workhorse truck chassis line into production in mid-2012. There are no predictions as to how many trucks that will add to production, and there are no immediate plans to add new jobs, said Steve Schrier, Navistar spokesperson. Workhorse was once a major player in the Class A gas motorhome chassis market, but no longer builds the platforms.

“This was announced to workers (Monday),” Schrier said. “It’s positive and good news for the people in Springfield.”

The new truck line is the second one Springfield has received from other Navistar plants. In 2008, Springfield began producing ProStar daybeds from the idle Chatham, Ontario plant, which allowed Springfield to recall some of the 250 workers laid off last October.

The new production line may not immediately bring new jobs, but it ensures that recalled workers can keep their jobs. The last of all laid off workers were recalled in August.

“This also shows we went from roughly 300 people on the assembly line growing toward 1,000,” said John Detrick, Clark County Commissioner. “This is the first time in a decade we’ve been in a position to potentially add jobs.”

Production has been steady enough that Navistar has actually added some temporary jobs this year. Schrier said temp workers take up about 3% of the work force, which is currently at 750 workers.

 

 

Navistar Enters Agreement with Investor Icahn

Navistar International Corp. today (Nov. 15) announced that it entered into an agreement with investor Carl Icahn and certain of his affiliates to submit a proposal at its 2012 annual meeting of shareholders to “destagger” the board to elect directors on an annual basis.

According to a press release, with this agreement, Icahn agreed not to seek board representation at the company’s 2012 annual meeting and agreed to vote in favor of the company’s nominees for election.

“Navistar’s board and management team are committed to acting in the best interests of the company and all its shareholders, and we believe that the annual election of our directors, without a staggered board, further strengthens our corporate governance practices,” said Dan Ustian, chairman, president and CEO of Navistar, a maker of trucks, buses and Monaco brand RVs. “We also are pleased to have reached an agreement with Mr. Icahn that includes his support for our Board nominees for election at our upcoming shareholders meeting.”

If approved by the shareholders, Navistar will begin the annual election process starting with the class of three directors up for election at the annual meeting. Instead of three-year terms, each nominee would be elected to a one-year term with a majority of the board being elected to a one-year term at the 2013 meeting and all nominees being elected on an annualized cycle as of the 2014 session.

 

‘Activist Investor’ Icahn has Stake in Navistar

Carl C. Icahn has already had a busy year, having taken aim at companies like Clorox and Forest Labs. That hasn’t stopped him from adding yet another target to his portfolio.

According to a report in the New York Times, the activist investor disclosed on Thursday (Oct. 13) that he had built up a 9.8% stake in Navistar International, a maker of trucks, buses and Monaco brand RVs. In a securities filing disclosing his holdings, Icahn wrote that he had already held discussions with management, including about potentially adding members to the company’s board.

Icahn did not say anything more about his intentions. In the past, his playbook has ranged from pushing a company to explore a potential sale to actually making his own takeover bid, though with the hope that someone else will come in with a higher price.

His record for 2011 has been a bit mixed. While Mr. Icahn scored big with the sales of Motorola Mobility and Genzyme, his attempts to wrest control of the boards at Clorox and Forest Labs fell short.

Navistar has had a bumpy year, with its net income swinging from a loss for the first three months of 2011 to moderate profits. Last month, the company lowered the bottom end of its current fiscal year earnings guidance.

As of Thursday’s closing price of $38.68, Navistar had a market value of about $2.8 billion. Shares in the truck maker have tumbled more than 21% over the last 12 months. Based in Warrenville, Ill., Navistar has 18,700 employees and is parent to Monaco RV LLC and Workhorse Custom Chassis LLC.

 

 

Navistar to Lease Alabama Plant, Hire Workers

Fortune 500 company Navistar International Corp. has agreed to lease the former National Alabama railcar plant in western Colbert County for at least 10 years, with plans to employ as many as 2,200 workers within four years.

The Times Daily, Florence, Ala., reported that Navistar officials said they are evaluating options on what products will be produced at the nearly mile-long plant at the Barton Riverfront Industrial Plant. That decision, as well as how many workers will be needed, will be announced before Navistar takes over operation of the plant on Jan. 1, said Jim Spangler, vice president and chief communications officer for Navistar.

Alabama Gov. Robert Bentley said during a visit to Haleyville this afternoon that the project will result in 2,200 jobs.

Navistar, which operates an engine plant in Huntsville, is the nation’s top producer of school buses and medium-duty trucks and is among the national leaders in production of 18-wheeler trucks. The company is also parent to Monaco RV LLC.

National Alabama, through the Retirement Systems of Alabama, now operates the facility and is working to complete at least three contracts.

The plant has about 120 workers, and Navistar has committed to providing jobs for those workers.

“Many communities go a lifetime and never have the opportunity for such a major industry to come in,” Florence Mayor Bobby Irons said.

The company intends to make the 2-million-square-foot plant a cornerstone of its expansion strategy, which they say will increase annual revenue from $14 billion to $20 billion.

 

Navistar Posts 3Q Gains, Will Buy Back Shares

Navistar International Corp., the Warrenville, Ill.-based truck and engine manufacturer, said it will buy back up to $175 million of its shares, or about 5% of those outstanding,  in a bid to prop up its flagging stock price, which has fallen 43% since April.

According to the Chicago Tribune, the announcement came as the company posted a $1.4 billion third-quarter profit, most of it coming from a massive $1.48 billion tax gain.

Navistar Chairman and Chief Executive Daniel C. Ustian said the tax benefit puts the company it its bestequity position in a decade.

“Given our strong cash position,” he said, “we are launching a significant buyback of our stock, which we believe is currently undervalued. We are also evaluating additional return on capital options and look forward to announcing them early in 2012.”

Navistar boosted sales in the third quarter by 9 percent to $3.5 billion from $3.2 billion a year ago during the same period.  Nine-month sales rose to $9.6 billion from $8.8 billion.

It also used the tax gain to shield restructuring costs in its manufacturing operations. Included in the third-quarter results were charges of $137 million for the company’s plans to close its Chatham, Ontario operations, restructuring of its custom products business unit, and costs associated with integrating engineering.

Third-quarter net income was $1.4 billion, or $18.24 a share, compared with $117 million, or $1.56 a share, a year ago. Taking out all the charges, adjusted earnings were 79 cents a share, compared to $1.44 during the 2010 third quarter.

For the year, Navistar expects 2011 adjusted earnings to track between $5 and $6 a share, which Reuters reported was down from its prior projection of $5.50 to $6 a share.

It forecast full-year revenue of $13.6 to $14.1 billion, slightly below its previous view of $13.6 to $14.3 billion, Reuters said.

The restructuring charges and a drop on government work helped produce a $75 million third-quarter lossin Navistar’s flagship truck business versus a $227 million gain a year ago. But it’s engine business posted a $32 million profit on improved intercompany sales and better margins versus $1 million last year. Parts segment profit rose to $70 million versus $52 million in the third quarter a year ago.

 

Coburg Begins Search to Occupy Monaco Plant

Much of Monaco RV’s 1 million-square-foot Coburg, Ore., facility will be idle by early next year when the company transfers its motorhome production to Wakarusa, Ind.

As reported by the Register Guard, Eugene, local economic development officials are working with Monaco’s parent, Chicago-based Navistar International Corp., to see if the transportation equipment giant could use the Coburg property for one of its other divisions.

Navistar makes International brand commercial trucks, school buses, military trucks, concrete mixers and other products.

“It’s still too early in the process to be able to speculate on that,” Navistar spokesman Steve Schrier said.

Jack Roberts, executive director of the Lane Metro Partnership, a business recruitment and retention agency, said he recently phoned Navistar officials offering to work with them to find another use for the Coburg site.

“They’re going to try to look for other potential uses in their divisions,” he said. “They said at the time they didn’t know of any, but they’re going to explore that.”

Roberts said he’s not pinning his hopes on that scenario because the same factors that drove Navistar’s decision to consolidate motorhome manufacturing in the Midwest also would apply to its other products.

“It seems odd to think they would move something out here after consolidating motor home manufacturing in Indiana,” he said.

“That didn’t seem likely, but we didn’t want to foreclose any opportunities.”

If Navistar can’t use the Coburg property itself, it would be attractive to other manufacturers, Roberts said.

“It’s a lot less limited in its use than the Hynix building (in west Eugene), for example, because it’s a large open space and it has a great location right there by I-5,” he said. “It’s a terrific space for a large manufacturer. We just have to find one.”

Inquiries about manufacturing space have picked up a bit this year, but usually in the range of 200,000 square feet, he said.

Roberts said he talked with Navistar a couple of years ago about possibly making some of its other products in Coburg.

“The reaction I got even then is their supply chain is all back there, and it’s a significant expense to try to bring it out here.”

 

 

Wakarusa is Enthused Following Navistar News

Good news travels fast in this small Indiana community in western Elkhart County.

The Goshen News reported that the morning after Navistar International Corp. announced it would move 400 manufacturing jobs from Oregon to Wakarusa, the town was buzzing with optimism.

As retiree Don Foster walked his Chihuahua down Elkhart Street near the post office Wednesday morning he was excited about the good news.

“I think it is good for the community,” he said. “It is going to put a lot of people back to work. That’s what we need.”

Foster and other town residents are well aware of the long-term economic woes that hit the town when Monaco Coach closed and terminated more than 1,000 people at its Wakarusa plant. Now, this new iteration of Monaco will be adding to the 250 employees producing Class A and Class C motorhomes at the massive complex that dominates the industrial park along Nelson Parkway.

Foster said he has friends who have worked in the recreational vehicle industry.

“Some of them,” he said, “have had a hard time finding work.”

‘That kind of excitement’

Down the street at the Chamber of Commerce, President Deb Shively had already met with her board of directors.

“It’s great news,” she said. “We are excited about that growth. And Utilimaster will be up to 1,000 employees by Labor Day and we feel Wakarusa is going to get back to where it used to be. There is that kind of excitement.”

Utilimaster converts box trucks for parcel delivery companies and a variety of other applications. The company has a joint venture with Isuzu Motors of Japan to build a line of new, light-weight vans and is adding jobs to fill orders.

Wakarusa developed in the 20th century as a hub of manufacturing activity. The small town — with its wide, tree-lined streets and early 20th century homes with large front porches — is bordered by industrial plants to its east. The industrial complexes reach out to Ind. 19 and line that highway to the north and south of C.R. 40.

Besides building RVs, Navistar builds its eStar electric truck in town. Visitors gawk at the site of the quiet electric trucks being test-driven around the town, something the locals have become used to.

“It’s like you are in the space age,” Shively said. “It is two extremes — it’s where small town USA and high-tech meet. It is very cool.”

Monaco and Navistar not only provide jobs to the town’s residents, Shively said, but the companies provide vital financial support for town activities. The companies returned as sponsors of the annual Maple Syrup Festival last year, Shively said.

“It was nice to see that support come back,” she said.

But it is the paychecks and the turn of those dollars from Monaco workers that will boost the local economy the most.

“Hopefully we will get people moving in and they will plug into the community, shopping locally and attending events,” Shively said.

Shane Weldy knows all about the hard hurt the economic downturn has visited upon Wakarusa families. He had been selling insurance for home warranties to local real estate agencies when the recession killed his career. Since then he and his wife, Charlotte, opened The New To You resale shop on Elkhart Street and also work part-time jobs as well to get by.

“Four hundred jobs is a lot,” Weldy said. “If we can get people to move to town it would be great for the community.”

He said people visit his store all the time who say they would like to live in Wakarusa. Now, with jobs being created in town, Weldy believes that will help sell homes.

“It’s definitely going to help the market,” he said.

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