Press Room
Press Releases - 2004
Keystone Suspends Sale of Two Aftermarket Light Applications
POMONA, Calif., Oct. 15, 2004 -- Keystone Automotive Industries, Inc. (Nasdaq:KEYS) announced that it has voluntarily suspended the sale of aftermarket headlamps for the Ford Taurus ('96 -- '04) and for the General Motors Pontiac Grand Am ('99 -- '04) as a result of independent tests indicating that at the present time, these headlamps do not fully comply with the federal standards.
As a result of the publication of the independent test results, at least six insurance companies have indicated that they have also suspended the use of the non-complying aftermarket headlamps in repairing damaged vehicles. In addition, Keystone believes that one or more insurance companies may have discontinued specifying all aftermarket headlamps in vehicle repair.
Keystone's sales of headlamps for the Taurus and Grand Am during the last 12 months constituted less than one-half a percent of its total sales and the sales of all headlamps during the period constituted approximately 12 percent of total sales.
"Rigorous testing and ongoing evaluation of products are fundamental to our industry. While the temporary suspension of the sale of these headlights is unfortunate, this action highlights Keystone's commitment to product safety and quality. Aftermarket parts are an important alternative to OEM brands, providing favorable economics compared with original equipment parts. This factor and Keystone's quality assurance programs continue to drive the acceptance of the company's products by collision repair shops, the insurance industry and consumers," said Richard L. Keister, president and chief executive officer of Keystone Automotive.
The company noted that sales to date have not been materially and adversely affected by recent suspension actions by certain insurance companies and the discontinuance of the sale of the Taurus and Grand Am headlamps will not have a material adverse effect on Keystone. However, a discontinuance of the specification of all aftermarket headlamps by a number of insurance companies would have a material adverse impact on the company's financial results.
About the Company
Keystone Automotive Industries, Inc. distributes its products primarily to collision repair shops through its 126 distribution facilities, of which 22 serve as regional hubs, located in 38 states and Canada. Its product lines consist of automotive body parts, bumpers, and remanufactured alloy wheels, as well as paint and other materials used in repairing a damaged vehicle. These products comprise more than 19,000 stock keeping units that are sold to more than 25,000 repair shops throughout the United States and Canada.
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for certain forward-looking statements. The statements contained in this press release that are not historical facts are forward-looking statements based on the company's current expectations and beliefs concerning future developments and their potential effects on the company. There can be no assurance that future developments affecting the company will be those anticipated by the company. Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve significant risks and uncertainties (some of which are beyond the control of the company) and are subject to change based upon various factors, including but not limited to the impact on the company as a result of actions which have been, or in the future may be, taken by insurance companies with respect to aftermarket lighting products and the willingness of aftermarket lighting manufactures to insure compliance with federal standards. Reference is also made to the Cautionary Statements set forth in the company's Form 10-K Annual Report filed with the Securities and Exchange Commission (SEC) on June 9, 2004 and in Part II, item 5 of its Form 10-Qs filed with the SEC thereafter for additional risks and uncertainties facing the company. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as the result of new information, future events or otherwise.
CONTACT:
Maier & Company, Inc.
Gary S. Maier
(310) 442-9852