E. Santi on automotive
From Illinois Tool Works CEO: Ratio For Success | Mad Money | CNBC · · CNBC
“The average bill of material in a car is roughly $155,000 and we have maybe $35 a car — it's very niche but very engineered.”
On , E. Santi, Executive Chairman at Illinois Tool Works Inc., spoke about automotive during Illinois Tool Works CEO: Ratio For Success | Mad Money | CNBC on CNBC.
About E. Santi
In a 2017 interview on CNBC's Mad Money, E. Santi, then Chairman and CEO of Illinois Tool Works (ITW), discussed the company's performance and strategy. He attributed ITW's ability to raise margins to its "8020" operating system, which focuses on the small percentage of customers and product lines that generate the majority of revenue while eliminating associated cost and complexity. Santi noted that this "laser-like focus" allows the company to improve profitability even in mature business segments. Santi also addressed specific market conditions and product development. He described ITW's automotive business as a "value-added problem solver" for OEMs, noting that the company's current content of about $35 per car leaves room for growth toward a $200-per-car addressable market. He reported a surge in European demand, with broad-based growth in construction and automotive. To address a shortage of skilled welders, Santi said ITW has developed technologically sophisticated welding equipment that is easier for less-experienced operators to use. He characterized the company's recent progress as the result of a multi-year pivot toward organic growth, combined with favorable macroeconomic conditions.