Sypris Awarded Additional Volume With Global Truck OEM

Rhea-AI Summary

Sypris Technologies, a subsidiary of Sypris Solutions (NASDAQ: SYPR), announced an amendment to its supply agreement with Detroit Diesel Corporation, a subsidiary of Daimler Truck North America. This amendment introduces new part numbers for drivetrain components crucial for the performance of Freightliner's heavy-duty vehicles. Production of these components is expected to begin in early 2023, enhancing the long-standing partnership with Daimler Truck, now in its 18th year. The financial terms of the agreement remain undisclosed.

Positive

• Expansion of supply agreement with Detroit Diesel Corporation enhances revenue potential.
• Introduction of new part numbers supports the performance of Freightliner heavy-duty vehicles.

Negative

• None.

New Drivetrain Components for Heavy-Duty Commercial Vehicles

LOUISVILLE, Ky.--(BUSINESS WIRE)-- Sypris Technologies, Inc., a subsidiary of Sypris Solutions, Inc. (Nasdaq/GM: SYPR), announced today that it has entered into an amendment to its current supply agreement with Detroit Diesel Corporation (“DDC”), a subsidiary of Daimler Truck North America. Daimler Truck North America is itself a subsidiary of Daimler Truck Holding AG (“Daimler Truck”), one of the world’s largest commercial vehicle manufacturers.

The amendment adds a new series of part numbers to its agreement with DDC for drivetrain components used in DDC’s Detroit®-branded drive axles. The components produced by Sypris are essential to the performance of the drive axles of Freightliner’s heavy-duty vehicles. Production of these additional part numbers under the amended contract are expected to commence in early 2023. No other terms or conditions of the agreement were disclosed.

Commenting on the announcement, Federico Aviles, Vice President and General Manager of Sypris Technologies Mexico, S. de R.L. de C. V., stated, “We are pleased to expand our strategic relationship with Daimler Truck, which is now entering its 18^th year. Daimler Truck is a global leader in the commercial vehicle industry and we are proud to serve as a partner by supplying quality products to support its reputation for high performance and durability.”

Sypris Technologies, Inc. is a premier manufacturer and supplier of drivetrain and other critical components for the commercial vehicle, automotive, recreational vehicle, mining, agriculture, industrial and energy markets. Sypris is headquartered in Louisville, Kentucky. Through its operations in North America, Sypris continues to meet the needs of the industry after more than 90 years of service. For more information about the Company, visit its Web site at www.sypris.com.

Detroit® is a single-source trucking business solution that offers mid-range and heavy-duty diesel engines, ePowertrains, transmissions, axles, safety systems, and connected vehicle services for on-highway and vocational commercial markets. Detroit products are sold and serviced through a network of hundreds of locations in North America. For more information, or to find the nearest Detroit location, visit DemandDetroit.com. Detroit is a brand of Detroit Diesel Corporation, a subsidiary of Daimler Truck North America.

Forward-Looking Statements

This press release contains “forward-looking” statements within the meaning of the federal securities laws. Briefly, we currently believe that such risks also include the following: our failure to achieve and maintain profitability on a timely basis by steadily increasing our revenues from profitable contracts with a diversified group of customers, which would cause us to continue to use existing cash resources or require us to sell assets to fund operating losses; cost, quality and availability or lead times of raw materials such as steel, component parts, natural gas or utilities including increased cost relating to inflation; the cost, quality, timeliness, efficiency and yield of our operations and capital investments, including the impact of inflation, tariffs, product recalls or related liabilities, employee training, working capital, production schedules, cycle times, scrap rates, injuries, wages, overtime costs, freight or expediting costs; dependence on, retention or recruitment of key employees and highly skilled personnel and distribution of our human capital; volatility of our customers’ forecasts and our contractual obligations to meet current scheduling demands and production levels, which may negatively impact our operational capacity and our effectiveness to integrate new customers or suppliers, and in turn cause increases in our inventory and working capital levels; our failure to successfully complete final contract negotiations with regard to our announced contract “orders”, “wins” or “awards”; adverse impacts of new technologies or other competitive pressures which increase our costs or erode our margins; breakdowns, relocations or major repairs of machinery and equipment, especially in our Toluca Plant; the fees, costs and supply of, or access to, debt, equity capital, or other sources of liquidity; the termination or non-renewal of existing contracts by customers; the costs and supply of insurance on acceptable terms and adequate coverage; the impact of COVID-19 and economic conditions on our future operations; possible public policy response to the pandemic, including U. S. or foreign government legislation or restrictions that may impact our operations or supply chain; inaccurate data about markets, customers or business conditions; our failure to successfully win new business or develop new or improved products or new markets for our products; risks of foreign operations; currency exchange rates; inflation; war, geopolitical conflict, terrorism, or political uncertainty, including disruptions resulting from the conflict between Russia and Ukraine arising out of international sanctions, foreign currency fluctuations and other economic impacts; our reliance on a few key customers, third party vendors and sub-suppliers; inventory valuation risks including excessive or obsolescent valuations or price erosions of raw materials or component parts on hand or other potential impairments, non-recoverability or write-offs of assets or deferred costs; disputes or litigation involving governmental, supplier, customer, employee, creditor, stockholder, product liability, warranty or environmental claims; failure to adequately insure or to identify product liability, environmental or other insurable risks; unanticipated or uninsured product liability claims, disasters, public health crises, losses or business risks; the costs of compliance with our auditing, regulatory or contractual obligations; labor relations; strikes; union negotiations; costs associated with environmental claims relating to properties previously owned; pension valuation, health care or other benefit costs; our inability to patent or otherwise protect our inventions or other intellectual property rights from potential competitors or fully exploit such rights which could materially affect our ability to compete in our chosen markets; changes in licenses, security clearances, or other legal rights to operate, manage our work force or import and export as needed; cyber security threats and disruptions, including ransomware attacks on our systems and the systems of third-party vendors and other parties with which we conduct business, all of which may become more pronounced in the event of geopolitical conflicts and other uncertainties, such as the conflict in Ukraine; or unknown risks and uncertainties. We undertake no obligation to update our forward-looking statements, except as may be required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230307005246/en/

Federico Aviles

Vice President & General Manager

(502) 420-1225

Source: Sypris Technologies, Inc.

FAQ

What is the recent announcement by Sypris Technologies regarding SYPR?

Sypris Technologies announced an amendment to its supply agreement with Detroit Diesel Corporation to add new drivetrain components for Freightliner heavy-duty vehicles.

When will production of the new components by Sypris Technologies begin?

Production of the new drivetrain components is expected to commence in early 2023.

How does the amended agreement affect Sypris Technologies and its shareholders?

The amendment potentially enhances revenue and strengthens Sypris's strategic partnership with Daimler Truck, benefiting shareholders.