Clear Focus on Automotive Acoustics in Mercosur Countries

Sao Paulo / Witten, October 16, 2008 - The HP Pelzer Group, a leading automotive supplier of acoustic parts for automobiles, has reorganized its Brazilian holdings. The company sold its minority stake in Pelzer System Ltda in Taubaté to its major shareholder there, Marc Pelzer, a member of the company’s founding family. In exchange, it purchased from him the remaining shares of Pelzer Systemas Ltda. in Gravatai (Rio Grande do Sul) and Pelzer da Bahia in Bahia. The factory in Taubaté produces injection moulded plastic parts, mainly bumpers and door panels.

Successful Steps on the Path to Protecting the Witten Location

Witten, March 14, 2008 - After intense and difficult talks that were nonetheless constructive, the management and the workers’ council had a breakthrough in their negotiations on how to protect the Witten location. Last night, the two parties signed a partial settlement and an agreement on the basic elements of the social plan. They also agreed on four concrete measures to reduce costs at the location.

At the same time, the number of people that need to be laid off was reduced from the original 59 to a maximum of 40. Both sides agreed to finish the ongoing negotiations about further projects by May 31, 2008.

As part of the new settlement, some 30 people in Witten will lose their jobs. At the same time, 10 new jobs have been created in the factory since the management is investing in Witten now instead of later, as previously planned, to fulfill an order for innovative products from Daimler AG that will come in during the second half.

In addition, HP Pelzer plans the following measures: It will stop liner production for good in Witten, resulting in the loss of 10 jobs in Witten, and liner production will be moved to the HP factory in Zatec, Czech Republic. In addition, because of a reorganization of production, HP Pelzer will move parts production for the VW models Touran and Caddy to Plzen and Zatec. This affects 12 jobs in Witten.

The cutting and final production of the interior carpets for the Opel Corsa will move from Witten to Berka in Thuringia by March 31. This will lower logistics costs and allow Opel to pick up the product from its own location in nearby Eisenach. In addition, further smaller measures that are improving productivity for serial production are causing the loss of eight jobs.

HP Pelzer will lay off people via termination agreements or for operational reasons. (German labor law distinguishes types of layoffs - such as a layoff for operational reasons - so that it is clear whether an employee was at fault for losing his or her job.) An element of the partial settlement made between management and the workers’ council includes the foundation of a “transfer company.” Workers will receive 80 percent of their net salary and further training via the transfer company. Workers who are offered termination agreements will receive severance pay based on their number of years with the company and their social needs.

Reorganization Requires Continued Changes

Witten, February 3, 2008. Automotive supplier HP Pelzer Group in Witten, which is in the midst of a difficult restructuring process, has asked the elected employee representatives to work together with management to find a way to secure Witten as a production location. Manufacturing of acoustic components and interior trim at the plant in Witten has been jeopardized for years by drastically falling sales and significant losses.

The management has presented the worker’s council with a 10-point plan for acute cost reductions. “The only way to avoid closing the plant in Witten is to put these measures into place with the full support of the workforce,” said Dr. Frank Sandfort, the head of finance. “We have recommended to our worker’s council that layoffs be conducted in the most humane way possible. The only way to continue production in Witten is to scale it down significantly,” he said.

Management has recommended laying off 59 of 360 people in Witten. Workers in development, the holding company and other central functions will not be affected. HP Pelzer’s factory in Witten has suffered losses as its large customers moved their own production, and the factory’s remaining orders often entail high logistical costs. The new three-person management team, in place since late last fall, is ready and willing to work together with employees to save Witten as a production location.

Shortly after taking over his role in the second half of 2007, the management board had announced that the HP Pelzer Group would have to lay off 10 percent of its workers to regain its competitiveness. At that point, it did not indicate which locations would be affected and how many people would be laid off.

HP Pelzer Group, headquartered in Witten, is a leading, worldwide supplier of automotive parts with a focus on automotive acoustics and interior trim. The most important automakers around the world are among its clients. The company operates 37 production sites and five development locations in 14 countries. It employs 5,500 people, including 800 in Germany. In 2006, HP Pelzer Group had sales of about 700 million euros.

Press Contact:

Bruno Seifert or Dr. Thomas Reuß
Corporate Communications, HP Pelzer Group
Brauckstraße 51
58454 Witten
Phone : +49 (0)6133 5090880
Fax : +49 (0)6133 5099098
Mobile : +49 (0)171 3322434 or 0171 3322505
e-mail: presse@pelzer.de