On October 1, 2018, Garrett Motion Inc. (NYSE: GTX) officially announced that it had successfully completed a tax-free spin-off from Honeywell International Inc., becoming an independent company. On the same day, Garrett CEO and President Olivier Rabiller led the executive team in ringing the opening bell at the New York Stock Exchange, marking a new chapter for the company with over 60 years of history. ‘This is a milestone event for Garrett,’ said Rabiller. ‘Going forward, we will provide highly differentiated technologies that meet the specific needs of our customers.’
It is understood that the decision to spin off was made in October 2017. After evaluation, Honeywell decided to separate its Transportation Systems business, with annual revenue of $3 billion, and its Home and ADI Global Distribution business, with annual revenue of $4.5 billion, from the group, making them two independent publicly traded companies.
As a global leader in the turbocharging industry, Honeywell’s primary competitors include BorgWarner of the United States, Mitsubishi Heavy Industries of Japan, Cummins-Holset of the United States, Continental of Germany, and Bosch Mahle, which has been acquired by Hong Kong capital. Data shows that with a sales revenue of $39.3 billion in 2016, Honeywell ranked 260th on the 2017 Fortune Global 500 list. In the same year, its operating profit reached $7.19 billion, with a profit margin of 18.3%. In 2017, Honeywell’s global sales increased to $40.5 billion, and the profit margin further improved to 19%.
“We will fully leverage the deep experience inherited from Honeywell Transportation Systems to develop Garrett into a dynamic and visionary new company,” said Olivier Rabiller. “Continuously evolving turbocharging technology has become the backbone of modern internal combustion engine technology, and Garrett will become synonymous with advanced power.”
Garrett has served automotive customers for over 65 years. It has pioneered and created many differentiated solutions in turbocharging technology, electrification technology, and connected vehicle software. Over the past year, Garrett’s global sales totaled approximately $3.1 billion.
In addition to original equipment manufacturers, Garrett will also provide parts and components to the global independent aftermarket, meeting the needs of various end customers. In the modified racing and enthusiast communities, Garrett has written the legend of turbocharging. Its extensive range of modified products meets the extreme performance demands of OEM racing teams in the highest-level international competitions, and is also the best choice for racing drivers and mechanics eager to improve engine performance.
Furthermore, Garrett has a stable and outstanding team with over 7,500 employees, including approximately 1,200 engineers, and holds over 1,400 issued and pending patents. To date, Garrett has served more than 40 global automakers and has 13 advanced manufacturing plants and 5 research and development centers close to its customers.
It is foreseeable that as an independent company, Garrett will actively seek industry opportunities and respond to and address the macro challenges of the global automotive industry by providing electric boosting products and connected vehicle software solutions to meet stricter fuel consumption and emission regulations and the growing demand for connected vehicles.
