Constancy of Purpose

Tuesday, May 01, 2001

Webster defines “mission” as “a specific task with which a person or group is charged.” HUSCO corporate vision and mission has always been establishing global leadership in our served markets, a mission which requires contributions by all HUSCO associates. In this issue of our newsletter I will comment on our corporate vision of establishing global leadership which has been in place for fifteen years. This “constancy of purpose” is crucial to our success. It is particularly important for HUSCO to maintain strategic intent in spite of the challenges of economic cycles. Today, HUSCO is investing in three major new business initiatives involving very large R&D investments.

These are:
• Automotive product and market development
• Off-highway suspension product and market development
• Electro-hydraulic products and systems to greatly expand HUSCO revenue and product capability potential.

These new businesses and products are crucial to HUSCO’s future sales and profitability growth and involve annual engineering investments of over $7 Million per year, a huge investment for a business our size. These investments are over and beyond the engineering development investments necessary to maintain and grow our existing base business.

We are now entering difficult economic times that make this high level of investment challenging. Markets are in recession and will likely decrease 10-20% during the next two years. The impact on our financial performance will be large, and the continuation of the significant R&D investments will result in a large decrease in our profitability. We will hold the course! During these difficult times, it is essential we keep focus on our ultimate mission and goals. This perspective has allowed HUSCO to make dramatic increases in market share after recessionary periods as our R&D investments pay off in major new programs, and the same will be true this time around. Our new technologies have the potential of generating new business opportunities which could double or triple HUSCO’s size during the next five to eight years, a very exciting prospect.
To insure future success, we must manage and balance short term performace with long term strategic initiatives. One of HUSCO’s major advantages relative to our competition is our private company status which provides for greater independence and flexibility. This allows us to invest in the future during difficult times without the need to placate outside investors who are usually short-term focused.

My primary job is to insure we have the financial resources to take advantage of our new business opportunities. The job of each of you is superior execution of your assigned tasks to insure viable financial performance by HUSCO during difficult times. Superior execution must be your mission.