America’s Lear Corporation, one of the world’s best-known automotive interior systems suppliers has revised its first-quarter 2005 net income guidance from a range of $0.50 to $0.70 per share to about breakeven, primarily reflecting additional industry production cuts, largely in North America.

Lear’s previous first-quarter net income guidance was based on an expected decline in North American production of about 5%, compared with the same period a year ago. Since then, production schedules have continued to decline, with a disproportionate concentration in vehicle platforms where Lear has substantial content. Additionally, the company is experiencing continuing cost pressures from its supply base.

“While we expect 2005 to be challenging on several fronts, we do expect the industry production environment to improve later in the year following this near-term inventory correction,” said Lear chairman and CEO, Bob Rossiter. “With our strong sales backlog and a company-wide emphasis on improving our cost structure, our longer-term outlook remains positive.”

Lear will discuss and update financial guidance for the remainder of 2005 when the company releases first-quarter financial results on Friday, April 22, 2005.

However, it is not all bad news for Lear, General Motors Corporation unveiled its all new Cadillac DTS and Buick Lucerne models at the Chicago Auto Show featuring complete interiors designed and developed by Lear Corporation in the first-ever collaborative effort between GM and one of its suppliers for a total interior.

Lear will provide approximately 80% of the interior content for the programme and will also integrate components from other suppliers. In addition to the interior content, Lear also supplies 100% of the wire harness and bussed electrical centers. In total, more than 1,500 part numbers will be supplied in five colours sequenced from various Lear-controlled distribution centres.

Premium materials and processes were carefully selected for the DTS and Lucerne interiors to allow them to compete among the best nameplates in the premium luxury segment. The vehicles are equipped with leather seating, with an optional 100% leather upgrade to semi-aniline leather on the DTS. The interiors also feature expansive use of real wood and chrome accents throughout the cockpit, lending a jewelled effect to the console.

Lear is also conducting total interior programs on an exclusive, low-volume scale on vehicles with highly visible launches, such as the Ford GT and the Maserati Quattroporte.

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