SOURCE: Delphi Corporation

January 08, 2007 09:07 ET

Delphi Wins Total Occupant Protection System and Navigation Business With Chery Automobile

Delphi Named Major Safety Supplier for China's Fastest Growing Domestic Auto Company

SHANGHAI, CHINA -- (MARKET WIRE) -- January 8, 2007 -- Chery Automotive has awarded Delphi Corporation (PINKSHEETS: DPHIQ) a contract to provide complete Occupant Protection Systems (OPS) and an integrated navigation system for several of Chery's platforms starting in 2009, Delphi officials announced today.

Delphi will integrate comprehensive Occupant Protection Systems that match the needs of each of Chery's vehicles

Beginning in 2009, Delphi will supply all driver and passenger airbags, curtain airbags, side airbags, passenger seat occupant detection systems, airbag control units, side- and frontal-impact sensors, and seat-track position sensors on all vehicles that Chery is currently producing.

For select Chery vehicles to be announced at a later date, Delphi will also supply a camera-based back-up aid system and navigation system. Delphi's integrated navigation radio LCD display will also serve as a source for looking at what is behind the vehicle while backing and map display.

"It is truly exciting to be named a major safety supplier for China's fastest growing domestic auto company," said Dan Salmons, Delphi Electronics & Safety managing director of Asia/Pacific. "Our job now is to execute and help Chery continue on its expansion into new markets. This business also helps Delphi further diversify our customer portfolio."

Since 1997, Chery Automobile Co., Ltd has grown its volume from 50,000 units in 2002 to almost 300,000 in 2006. Chery expects to increase its production and sales volume to 1 million units in 2010.

The company produces seven vehicles including Eastar, Tiggo, A5, Cowin, V5, QQ3 and QQ6.

Chery started exporting vehicles in 2001. Last year, the company shipped nearly 20,000 units to more than 50 countries. Future plans call for Chery to export vehicles to the United States, the world's largest car market.

"Chery chose Delphi over our competitors because of our price competitiveness, capability and knowledge of the North American market," said Charles Goad, Delphi Electronics & Safety Entertainment & Communications executive. "Our capability to offer complete systems was a distinct advantage for Delphi."

Delphi designed and manufactured its first airbags in 1974. Today, the company produces more than 20 million airbag systems per year to help vehicle manufacturers meet requirements specified by the U.S. Federal government.

Delphi offers a number of frontal airbag designs with adaptive features like cushion deployment volume, inflation output and venting based on crash conditions. Delphi's dual depth airbags are designed to enhance protection of a vehicle's front seat occupants -- no matter what their size -- in moderate to severe crash situations. Delphi's frontal airbags are compatible with customer instrument panels and therefore ease of assembly.

Designed to deploy from the vehicle's roof rail, Delphi's curtain airbags provide head protection and can be used in combination with Delphi's door-or-seat mounted side impact airbags.

Delphi's passive occupant detection system is designed to help automakers meet U.S. regulations. A sensing system built into the seat detects loading force on the front passenger seat and classifies the seat as empty or the occupant as an adult or child. The system helps reduce potential for airbag-induced injury by suppressing the airbag if the occupant is below a weight threshold. It also prevents deploying the airbag unnecessarily by suppressing the airbag if the seat is empty.

The nerve center of Delphi's occupant protection system is the airbag control unit. This sophisticated electronic unit interfaces with Delphi's frontal impact sensors, side impact sensors and occupant status sensors, vehicle indicators and the deployable safety devices. Using crash-sensing algorithms, the airbag control unit assesses crash event severity and direction and uses this strategy to deploy frontal, side or devices to disconnect the battery. Delphi's Forewarn Back-Up Aid uses a monocular camera to help prevent back up accidents. This assists the driver in seeing what is behind the vehicle on a screen in the instrument panel while backing up.

The Chery integrated radio navigation system sourced from Delphi will include touch screen operation DVD, USB, MP3, SD and rear seat entertainment controls.

Delphi began investing in China in 1993 and now has 15 facilities across the country. These operations manufacture more than 40 categories of products for customers in China and overseas.

For more information about Delphi, visit


This press release, as well as other statements made by Delphi, may contain forward-looking statements that reflect, when made, the company's current views with respect to current events and financial performance. Such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the company's operations and business environment which may cause the actual results of the company to be materially different from any future results, express or implied, by such forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the following: the ability of the company to continue as a going concern; the ability of the company to operate pursuant to the terms of the debtor-in-possession facility; the company's ability to obtain court approval with respect to motions in the chapter 11 cases prosecuted by it from time to time; the ability of the company to develop, prosecute, confirm and consummate one or more plans of reorganization with respect to the Chapter 11 cases; the company's ability to satisfy the terms and conditions of the Equity Purchase and Commitment Agreement with its Plan Investors; the company's ability to satisfy the terms and conditions of the Plan Framework Support Agreement with GM and its Plan Investors (including the company's ability to achieve consensual agreements with GM and its U.S. labor unions on a timely basis that are acceptable to the Plan Investors in their sole discretion); risks associated with third parties seeking and obtaining court approval to terminate or shorten the exclusivity period for the company to propose and confirm one or more plans of reorganization, for the appointment of a chapter 11 trustee or to convert the cases to chapter 7 cases; the ability of the company to obtain and maintain normal terms with vendors and service providers; the company's ability to maintain contracts that are critical to its operations; the potential adverse impact of the Chapter 11 cases on the company's liquidity or results of operations; the ability of the company to fund and execute its business plan (including the transformation plan described in Item 1. Business "Potential Divestitures, Consolidations and Wind-Downs" of the Annual Report on Form 10-K for the year ended December 31, 2005 filed with the SEC) and to do so in a timely manner; the ability of the company to attract, motivate and/or retain key executives and associates; the ability of the company to avoid or continue to operate during a strike, or partial work stoppage or slow down by any of its unionized employees; and the ability of the company to attract and retain customers. Other risk factors are listed from time to time in the company's United States Securities and Exchange Commission reports, including, but not limited to the Annual Report on Form 10-K for the year ended December 31, 2005. Delphi disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events and/or otherwise.

Similarly, these and other factors, including the terms of any reorganization plan ultimately confirmed, can affect the value of the company's various pre-petition liabilities, common stock and/or other equity securities. Additionally, no assurance can be given as to what values, if any, will be ascribed in the bankruptcy proceedings to each of these constituencies. A plan of reorganization could result in holders of Delphi's common stock receiving no distribution on account of their interests and cancellation of their interests. Under certain conditions specified in the Bankruptcy Code, a plan of reorganization may be confirmed notwithstanding its rejection by an impaired class of creditors or equity holders and notwithstanding the fact that equity holders do not receive or retain property on account of their equity interests under the plan. In light of the foregoing and as stated in its October 8, 2005, press release announcing the filing of its Chapter 11 reorganization cases, the company considers the value of the common stock to be highly speculative and cautions equity holders that the stock may ultimately be determined to have no value. Accordingly, the company urges that appropriate caution be exercised with respect to existing and future investments in Delphi's common stock or other equity interests or any claims relating to pre-petition liabilities.

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