St. Louis, United States
Viasystems, Inc., a global provider of printed circuit boards and electro-mechanical components and assemblies announced today that as a result of significant ongoing increases in raw material costs, it is increasing prices to its printed circuit board customers. This price increase is the second interim price increase implemented this year, as a result of these continuing increases on its cost base.
"We have seen the prices of raw copper, crude oil, gold and silver hit record highs. This unprecedented increase in commodity costs has driven our material suppliers to increase their prices to us, specifically laminate, copper foil and resin costs. These material cost increases, together with ongoing labor rate and currency exchange rate inflation, have adversely impacted our cost base, where we have experienced increases as high as 20-30%. We have been aggressively pursuing cost reduction activities in order to minimize the impact of the cost increases on Viasystems and our customers. We have also used alternate materials or suppliers whenever possible. Unfortunately, we are unable to offset these recent cost increases and, therefore must again pass on some of the cost impact to our customers. With material costs representing approximately 50% of our costs, increases such as these are difficult to absorb," stated David M. Sindelar, CEO of Viasystems.
Effective October 2, 2006, Viasystems will begin the implementation of a price increase. The magnitude of the price increase should average approximately 5%, but will vary from customer to customer, based on the specific product's bill of materials and the effect the cost increase has had on it.
This press release contains forward-looking statements as defined by the federal securities laws, and these statements are based upon Viasystems' current expectations and assumptions, which are inherently subject to various risks and uncertainties that could cause actual results to differ from those anticipated, projected, or implied. Certain factors that could cause actual results to differ include fluctuations in operating results and customer orders, a competitive environment, reliance on large customers, risks associated with international operations, ability to protect patents and trade secrets, environmental laws and regulations, relationship with unionized employees, risks associated with acquisitions, substantial indebtedness, control by large stockholders and other factors described in Viasystems' filings with the Securities and Exchange Commission.
Viasystems, Inc. is a global provider of complex multi-layer printed circuit boards and electro-mechanical components and assemblies. The company's 18,600 employees serve more than 200 customers in the automotive, telecommunications, computer and data communications and industrial and instrumentation markets.
CONTACT: Viasystems, Inc. Kelly E. Wetzler 314-746-2217
Source: Business Wire (Business Wire India)