For better or worse, Lear Corp. was born Aug. 22, 1995. That day, the Southfield, Mich., automotive seating supplier finished buying Automotive Industries Holding Inc. of Rochester Hills, Mich., for $626.5 million.
More than simple dollars and cents, Lear created one of the world's first automotive interiors giants, with more than $3.6 billion in 1994 sales. Soon after, the vehicle interior — where a majority of all plastic parts are found — has became a land of the giants picked over by industry tyrannosaurs.
Today, the interior is where megasuppliers play. They include Johnson Controls Inc.'s automotive division in Plymouth, Mich.; United Technologies Automotive of Dearborn, Mich.; and Textron Automotive Co. of Troy, Mich. Moreover, they compete with the multibillion-dollar parts-making arms of General Motors Corp. (Delphi Interior & Lighting Systems) and Ford Motor Co. (Visteon Automotive Systems).
Automotive Industries was one of North America's largest interior trim producers, racking up close to $500 million in sales and operating from a dozen plants. Lear had won a high-priced bidding war for the firm, which continues to have an effect. In 1996 it changed its name from Lear Seating Corp. to Lear Corp.
Since then, Lear has become interiors-ready. It has purchased two molders in Italy, formed a joint venture with Holland, Mich., supplier Donnelly Corp. to make plastic headliners and bought floor systems producer Masland Corp.
But the news hasn't all been uphill. Lear recently had to pay the piper for its rapid ascent into interiors.
In December, it announced the closing of 18 plants worldwide and layoffs totaling 2,800. Costs had gotten out of hand, and Lear's stock price tumbled. Among the layoffs were many former Automotive Industries executives. One Lear manager said the acquisition produced too many layers of bureaucracy, crippling the supplier's ability to react quickly. Lear is now grappling with its swelling product portfolio: keeping costs in line.