Plastic joins steel: deal between Superb and Regal merges two B.E. 100s auto suppliers.Two of the nation's largest black businesses are planning to merge by the end of this year, positioning their new business to survive in the fiercely competitive automotive industry The automotive industry is the industry involved in the design, development, manufacture, marketing, and sale of motor vehicles. In 2006, more than 69 million motor vehicles, including cars and commercial vehicles were produced worldwide. . If Bing Bing , Sir Rudolf 1902-1997. Austrian-born British impresario who managed (1950-1972) the Metropolitan Opera in New York City. Bing a heap or pile, particularly of metallic substances. Group's Superb Manufacturing Inc. of Detroit Detroit, city, United States Detroit (dĭtroit`), city (1990 pop. 1,027,974), seat of Wayne co., SE Mich., on the Detroit River and between lakes St. Clair and Erie; inc. as a city 1815. and the Roseville Roseville. 1 City (1990 pop. 44,685), Placer co., N central Calif., a suburb of Sacramento in the foothills of the Sierras; inc. 1909. Marked by rapid growth in the late 20th cent. , Mich.-based Regal Plastics Co. Inc. move is successful, it could paint the road for other African-American automotive suppliers to follow. Small supplier mergers are already a trend among majority-owned companies that want to stay competitive. "We did it for strategic reasons," says David Bing, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. and chairman of the Bing Group, ranked No. 12 on the BLACK ENTERPRISE INDUSTRIAL/SERVICE 100. "Small suppliers are going to be a thing of the past. You have to have the ability to be a full-service supplier." The new company will be named Bing Manufacturing and will be headed by the former president of Chrysler's Acustar Inc., Forest Farmer. He has been named the president and CEO. Farmer, who was included among BE's Power 40 list of corporate America's top black executives, oversaw o·ver·saw v. Past tense of oversee. budgets at Acustar of about $300 million and steered productivity of the subsidiary. Sometime next year, Bing says, the company will make an initial private stock offering of about $15 million. The money will finance estimated construction and equipment costs of between $12 to $15 million. It will be built on Bing's 30-acre industrial park near downtown Detroit. Bing, 50, will be chairman of the new company and William Pickard, 52, CEO and chairman of Regal, ranked No. 68 on the BE INDUSTRIAL/SERVICE 100 list, will be the vice chairman. Pickard declined to comment on the merger. "Both gentlemen have exhibited a visionary 1. visionary - One who hacks vision, in the sense of an Artificial Intelligence researcher working on the problem of getting computers to "see" things using TV cameras. (There isn't any problem in sending information from a TV camera to a computer. approach by recognizing there can be greater opportunities for the combined companies," says Leon Tupper, president of the National Association of Black Automotive Suppliers. "This would put them in the hunt with the big boys." The three largest domestic automakers--Chrysler Corp., Ford Motor Co. and General Motors Corp.--are targeting major suppliers to design, develop and produce automotive systems See ITS, embedded system, drive-by-wire, adaptive cruise control, collision avoidance system, autonomous vehicle, heads-up display, DSRC, lane departure system, CAN bus, FlexRay and SYNC. , says Karl D. Gregory, economics and management consultant and business professor at Oakland University History Oakland University was created in 1957 when Matilda Dodge Wilson, widow of automobile magnate John Francis Dodge, and her second husband Alfred Wilson donated their 1,500-acre estate to Michigan State University, including Meadow Brook Hall, Sunset Terrace and all the in suburban Detroit. Japanese automakers began switching from buying parts to requiring suppliers to develop full systems in the 1960s. American companies began following suit five years ago. The reason, says Tupper, is to control costs by shifting the burden of development. Bing says that negotiations are in progress with the Big Three automakers, already clients for both firms, for commitments to the new company. The Bing Group makes steel structures for automobile exteriors and Regal makes plastic interior parts for cars. Together they could build automobile seating frames, consoles and instrumental panels. Tupper believes direct suppliers for the automakers will have a revenue stream of more than $100 million. Bing projected the merger of Superb and Regal would produce a $200 to $300 million company in the next three to five years. The Bing Group had $83.3 million in 1993 sales and Regal Plastics had $23.5 million in sales for the same period of time. |
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