In August 1998, GM announced that its board of directors had determined that it would be in the best interest of GM and its stockholders to separate Delphi from GM. As a first step in this separation, Delphi completed an initial public offering of approximately 17.7 percent of its common stock in February 1999. GM's distribution and contribution to the VEBA trust today of the remaining 82.3 percent of Delphi common stock are the final steps in completing the separation.

John F. Smith, Jr., Chairman and Chief Executive Officer, General Motors Corporation

Photo: GM

Hayes Lemmerz is the largest supplier of both steel and aluminum wheels in Europe. Globally, Hayes Lemmerz is one of the leading suppliers of wheels, brakes, suspension, structural and other light weight components to the global transportation industry. Phase I of the two stage plan for the new 144,000 square foot facility calls for annual production of 500,000 cast aluminum wheels. Phase II will bring the total capacity to one million wheels within the next two years. This plant will have the most modern production equipment to meet the highest standards in the industry.

The new contract from Skoda, for the Felicia, positions Hayes Lemmerz to supply a significant share of Skoda's aluminum wheel requirements. The total value of this aluminum wheel contract is in excess of $5 million and is part of a long term supply agreement initiated with Skoda.

The aluminum plant's neighboring steel wheel facility in Ostrava is also producing steel wheels for Skoda and other customers. The Ostrava steel wheel facility has capacity for six million wheels and with three other steel wheel facilities, has the capacity to annually produce over 25 million steel wheels for the European automotive industry. In September, Hayes Lemmerz will also begin a new wheel tire assembly facility for Skoda in Mloda Boleslav in the Czech Republic, its fifth such just-in-time assembly facility in Europe.

"We are pleased that our new Ostrava plant will be initiated with a contract from our long-standing customer Skoda, said Giancarlo Dallera, President of Hayes Lemmerz European Aluminum Wheels. "This additional capacity will also take some of the burden off of our other facilities which have been stretched to meet overwhelming demand for our top quality aluminum wheels. We continue to extend our number one market position in both aluminum and steel wheels in Europe and worldwide. The addition of new world class production in the Czech Republic is key to our future growth."

"We are also continuing to grow our steel wheel production in the Czech Republic," added Klaus Juenger, President of Hayes Lemmerz European Fabricated Wheels. "Now we are also adding a wheel tire assembly plant adjacent to the Skoda car factory to further support this important customer. All of this growth is driven by our strong technology and high quality and we see many opportunities to continue to grow with the major car producers in Europe and globally."