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Contacts: Jane Ostrander Marc Harlow
Media Relations Media Relations
847 482-5607 313 567-5014
jostrander@tenneco.com 810 599-2558 (cell)
mharlow@franco.com
Leslie Hunziker
Investor Relations
847 482-5042
lhunziker@tenneco.com
TENNECO AUTOMOTIVE PROPOSES TO MOVE EXHAUST PRODUCTION FOR
HARLEY DAVIDSON TO NEBRASKA
COMPANY RECOMMENDS CLOSING SALINAS, CA FACILITY
Lake Forest, Illinois, May 12, 2005 - Tenneco Automotive (NYSE: TEN) announced
today that it intends to move its muffler and exhaust system operations
supplying Harley-Davidson from the company's facility in Salinas, California to
its Seward and Lincoln, Nebraska facilities. The proposed move would take place
over the next 15 months and impact roughly 190 employees currently employed at
the Salinas plant. The proposed move is designed to improve efficiency and
reduce costs by moving operations closer to the customer and filling existing
manufacturing capacity. The company also intends to consolidate engineering for
Harley Davidson at its North American emission control engineering center in
Grass Lake, Michigan, which would reduce costs and enhance technical
capabilities.
"We regret the impact of this proposed move on the employees in Salinas. We are
committed to working with them and their union to make the transition as smooth
as possible," said Mark P. Frissora, chairman and CEO, Tenneco Automotive. "It's
important that we continue to take steps to improve our operations worldwide.
Our comprehensive evaluation of the Salinas operations showed that significant
efficiencies could be achieved by moving production to our Nebraska facilities
and consolidating engineering. We
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anticipate this proposed move would reduce costs and improve delivery time,
quality and technical capabilities."
The proposed move is the result of evaluating options for integrating Gabilan
Manufacturing into the Tenneco Automotive operations after the February 2005
acquisition of the company. Gabilan had been the exclusive supplier of mufflers
and exhaust systems to Harley Davidson. Tenneco Automotive's purchase of the
company was a strategic acquisition to expand its presence in the specialty
vehicle market.
Tenneco Automotive currently produces muffler and other exhaust products for
both OE and aftermarket customers at its Seward, Neb. facility. Plating for
Harley Davidson mufflers and exhaust systems takes place at the nearby Lincoln
Plating in Lincoln, Neb. The proposed production move would create approximately
90 new jobs at the company's Nebraska facilities. The company intends to move
engineering and prototyping to Tenneco Automotive's Grass Lake, Mich. and Seward
facilities. Other former Gabilan Manufacturing facilities in Milwaukee, Wis. and
Emgisville, Penn. would not be affected.
Tenneco Automotive is a $4.2 billion manufacturing company with headquarters in
Lake Forest, Illinois and approximately 18,800 employees worldwide. Tenneco
Automotive is one of the world's largest producers and marketers of ride control
and exhaust systems and products, which are sold under the Monroe(R) and
Walker(R) global brand names. Among its products are Sensa-Trac(R) and Monroe(R)
Reflex(TM) shocks and struts, Rancho(R) shock absorbers, Gillet (TM), Walker(R),
Quiet-Flow(TM) mufflers and DynoMax(R) performance exhaust products, and
Monroe(R) Clevite(TM) vibration control components. Any other product names,
trademarks and registered trademarks are the properties of their respective
owners.
This press release contains forward-looking statements. Words such as "will",
"expects" and similar expressions identify forward-looking statements. These
forward-looking statements are based on the current expectations of the company
(including its subsidiaries). Because these forward-looking statements involve
risks and uncertainties, the company's plans, actions and actual results could
differ materially. Among the factors that could cause these plans, actions and
results to differ materially from current expectations are: (i) the general
political, economic and competitive conditions in markets and
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countries where the company and its subsidiaries operate, including currency
fluctuations and other risks associated with operating in foreign countries;
(ii) changes in automotive manufacturers' production rates and their actual and
forecasted requirements for the company's products, including the company's
resultant inability to realize the sales represented by its awarded book of
business; (iii) changes in consumer demand and prices, including decreases in
demand for automobiles which include the company's products, and the potential
negative impact on the company's revenues and margins from such products; (iv)
the cost of compliance with changes in regulations, including environmental
regulations; (v) workforce factors such as strikes or labor interruptions; (vi)
material substitutions and increases in the costs of raw materials; (vii) the
company's ability to develop and profitably commercialize new products and
technologies, and the acceptance of such new products and technologies by the
company's customers; and (xviii) the timing and occurrence (or non-occurrence)
of transactions and events which may be subject to circumstances beyond the
control of the company and its subsidiaries. The company undertakes no
obligation to update any forward-looking statement to reflect events or
circumstances after the date of this press release.
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