Dana (DAN) 49th Annual Automotive Symposium summary

Business transformation and portfolio changes

• Executed sale of Off-Highway business to Allison Transmission, reducing segments from four to two and streamlining operations.

• Sale driven by desire to fund electrification opportunities and address undervaluation of high-margin Off-Highway segment.

• Proceeds used to buy back over 30 million shares, reducing share count to about 115 million and achieving near net debt neutrality.

• Stock price responded positively to both the sale announcement and deal closure, reflecting shareholder confidence.

• Focus shifted to core light vehicle and commercial vehicle businesses, with aftermarket operations consolidated under commercial vehicle.

Cost reduction, margin improvement, and operational focus

• Set a $300 million cost reduction target, later increased to $310 million, with $235 million expected in the current fiscal year.

• Streamlined management, consolidated business segments, and simplified North American operations.

• Margins targeted at 10–10.5% by 2026, with significant progress already made.

• Identified further $100 million in cost savings through systems investments and $70–80 million via automation upgrades.

• Ongoing review of product line profitability to exit or reprice unprofitable offerings.

Market conditions, growth opportunities, and strategic direction

• Commercial vehicle market remains weak, with no signs of near-term recovery or prebuy activity expected in 2026.

• EV business scaled back due to lower-than-expected market volumes, focusing on existing customers and natural hedges with ICE products.

• Growth driven by share gains in large SUV and commercial vehicle markets, supported by new USMCA-compliant manufacturing in Mexico.

• Aftermarket business, especially in North America, targeted for expansion with recent key wins.

• Defense and power sports segments identified as $200–300 million growth opportunities, with plans to resource and pursue them.