Stoneridge, Inc. (SRI): Business Model Canvas [10-2024 Updated]

Stoneridge, Inc. (SRI) stands out in the automotive electronics industry with a robust business model canvas that highlights its strategic approach to innovation and partnership. By focusing on key partnerships with OEMs and Tier 1 suppliers, along with advanced manufacturing capabilities, SRI is well-positioned to deliver high-quality, customized solutions that meet the evolving demands of automotive manufacturers. Explore the intricate details of their operations, from value propositions to revenue streams, and discover how they maintain a competitive edge in the market.

Stoneridge, Inc. (SRI) - Business Model: Key Partnerships

Collaborations with OEMs and Tier 1 suppliers

Stoneridge, Inc. maintains strong collaborations with various Original Equipment Manufacturers (OEMs) and Tier 1 suppliers to enhance its product offerings. In the nine months ended September 30, 2024, net sales from the Control Devices segment amounted to $230.2 million, down from $267.4 million in the same period of 2023, reflecting a decrease of $37.2 million or 13.9%. The decrease was primarily due to lower customer volumes in the North American automotive market, including electronic and hybrid vehicle platforms.

Strategic alliances in technology development

Stoneridge has entered into strategic alliances focused on developing advanced technologies. In 2024, the company continued to invest in technology development, notably in its Electronics segment, which reported net sales of $422.8 million for the nine months ended September 30, 2024, compared to $435.6 million in the same period of 2023. This strategic direction aims to leverage data services, software, and AI capabilities, particularly in bus applications.

Partnerships for product distribution and marketing

To strengthen its market presence, Stoneridge has developed partnerships for product distribution and marketing. The total net sales decreased by 7.5% in the nine months ended September 30, 2024, totaling $690 million, down from $746.3 million in 2023. This decline reflects challenges in maintaining distribution efficiency amid changing market dynamics.

Engagement with regional distributors in South America

Stoneridge's engagement with regional distributors in South America has been crucial for its operations. The net sales in South America for the nine months ended September 30, 2024, were $37.1 million, a decrease of 14.4% from $43.3 million in the previous year. This decrease was primarily due to unfavorable foreign currency translations and lower OEM product sales, necessitating a reevaluation of distribution strategies in the region.

Partnership Type	Net Sales (2024)	Net Sales (2023)	Change ($)	Change (%)
Control Devices Segment	$230.2 million	$267.4 million	$(37.2 million)	(13.9%)
Electronics Segment	$422.8 million	$435.6 million	$(12.8 million)	(2.9%)
South America Segment	$37.1 million	$43.3 million	$(6.2 million)	(14.4%)
Total Net Sales	$690.0 million	$746.3 million	$(56.3 million)	(7.5%)

Stoneridge, Inc. (SRI) - Business Model: Key Activities

Designing and manufacturing vehicle control devices

Stoneridge, Inc. specializes in designing and manufacturing a range of vehicle control devices, including actuators, sensors, switches, and connectors. For the nine months ended September 30, 2024, the Control Devices segment reported net sales of $230.2 million, a decrease of 13.9% from $267.4 million in the same period in 2023. The gross margin for this segment was impacted by lower sales levels, leading to a decrease in operating income to $8.0 million from $12.6 million, a decline of 36.6%. This reduction is attributed to decreased demand in the North American automotive market, which accounted for a $44 million drop in sales.

Developing driver information and safety systems

The Electronics segment of Stoneridge focuses on developing advanced driver information systems and safety products, including vision systems and electronic control units. In the third quarter of 2024, this segment generated net sales of $127.5 million, down 5.3% from $134.7 million in the third quarter of 2023. Despite the decline, the segment's gross margin remained stable due to material cost improvements and a favorable sales mix. The ongoing development of the MirrorEye® OEM program and other safety-related technologies reflects Stoneridge's commitment to innovation in vehicle safety.

Conducting market analysis for product innovation

Stoneridge actively conducts market analysis to identify trends and opportunities for product innovation. This includes assessing customer needs and adapting product offerings accordingly. The company reported a decrease in design and development costs to $53.7 million for the nine months ended September 30, 2024, compared to $57.5 million in 2023. This reduction is due to decreased launch activities and customer reimbursements, which indicates a strategic pivot to optimize R&D expenditures while continuing to innovate.

Managing supply chain and production efficiency

Efficient supply chain management is critical for Stoneridge, particularly in light of recent fluctuations in material costs. For the first nine months of 2024, the cost of goods sold decreased to $543.5 million from $590.5 million in 2023, reflecting efforts to improve production efficiency and reduce overhead. The company achieved a gross margin of 21.2%, up from 20.9% in the previous year, due in part to a favorable product mix and reductions in foreign exchange-related variances. Significant efforts have been made to streamline operations and enhance supply chain resilience, especially in response to challenges in the automotive market.

Key Financial Metrics	Q3 2024	Q3 2023	Change (%)
Net Sales - Control Devices	$73.1 million	$89.3 million	-18.1%
Net Sales - Electronics	$127.5 million	$134.7 million	-5.3%
Net Sales - Stoneridge Brazil	$13.2 million	$14.2 million	-6.7%
Gross Margin	20.8%	22.0%	-5.5%
Operating Income	$315 thousand	$6.5 million	-95.2%

Stoneridge's focus on key activities such as designing and manufacturing vehicle control devices, developing driver information systems, conducting market analysis, and managing supply chain efficiency reflects a strategic approach to maintaining competitiveness and fostering innovation in the automotive sector.

Stoneridge, Inc. (SRI) - Business Model: Key Resources

Advanced manufacturing facilities in North America and Brazil

Stoneridge operates advanced manufacturing facilities strategically located in North America and Brazil. As of September 30, 2024, the total assets of Stoneridge were $662.5 million, with $153.0 million attributed to the Control Devices segment and $399.5 million to the Electronics segment. The company reported capital expenditures of $14.9 million for the nine months ended September 30, 2024.

Intellectual property and patents for proprietary technology

Stoneridge holds numerous patents that enhance its competitive edge in automotive electronics. The company focuses on innovative technologies that address industry megatrends, particularly in vehicle intelligence and connectivity. The proprietary technology includes advanced driver information systems and vision safety systems.

Skilled workforce with expertise in automotive electronics

The company prides itself on a skilled workforce specialized in automotive electronics. As of September 30, 2024, Stoneridge had 27,689 shares outstanding, reflecting a stable employee base contributing to its operations. The workforce is crucial in supporting design and development efforts, which saw a decrease in expenses to $53.7 million for the nine months ended September 30, 2024.

Established relationships with key automotive manufacturers

Stoneridge has built long-standing relationships with major automotive manufacturers, facilitating its access to key markets. The company reported net sales of $690.0 million for the nine months ended September 30, 2024, with significant contributions from its Control Devices and Electronics segments, which accounted for 33.3% and 61.3% of sales, respectively.

Key Resource	Details	Financial Impact
Manufacturing Facilities	North America and Brazil	Assets: $662.5 million
Intellectual Property	Proprietary technology for automotive electronics	Innovation driving competitive edge
Skilled Workforce	Specialized in automotive electronics	SG&A: $88.8 million for nine months ended Sept 2024
Automotive Relationships	Established ties with major manufacturers	Net Sales: $690.0 million for nine months ended Sept 2024

Stoneridge, Inc. (SRI) - Business Model: Value Propositions

High-quality, innovative vehicle safety and control products

Stoneridge, Inc. designs and manufactures a range of high-quality vehicle safety and control products. In the third quarter of 2024, the company's net sales amounted to $213.8 million, a decrease of 10.2% from $238.2 million in the same period of 2023. The decline was particularly influenced by lower customer volumes in the North American automotive market, leading to a significant drop in sales across its Control Devices segment, which reported net sales of $73.1 million, down from $89.3 million year-over-year.

Custom solutions tailored to OEM specifications

Stoneridge focuses on providing custom solutions to Original Equipment Manufacturers (OEMs), enhancing its competitive edge. The company’s Electronics segment, which includes advanced driver assistance systems and vehicle connectivity solutions, generated $127.5 million in net sales during Q3 2024. This segment has shown resilience against market fluctuations, benefiting from ongoing demand for innovative solutions in commercial and off-highway vehicles, despite a slight decrease from $134.7 million in Q3 2023.

Strong focus on compliance with industry standards

Stoneridge maintains a strong commitment to compliance with industry standards, which is crucial for customer trust and market positioning. The company’s products are designed to meet stringent safety and regulatory requirements, contributing to its reputation as a reliable supplier in the automotive sector. For instance, the company reported a gross margin of 21.2% for the first nine months of 2024, slightly up from 20.9% in the same period of 2023, indicating effective cost management in compliance-related expenditures.

Commitment to sustainability and efficiency in manufacturing

Stoneridge is dedicated to sustainability and efficiency in its manufacturing processes. The company has implemented various initiatives aimed at reducing material costs and enhancing operational efficiency. In the first nine months of 2024, material costs as a percentage of net sales decreased to 57.3%, down from 59.6% in 2023. This reduction is attributed to improved product mix and material cost management strategies, aligning with industry trends towards more sustainable manufacturing practices.

Metric	Q3 2024	Q3 2023	Change ($)	Change (%)
Net Sales (Total)	$213.8 million	$238.2 million	$(24.3 million)	(10.2%)
Control Devices Segment Sales	$73.1 million	$89.3 million	$(16.2 million)	(18.1%)
Electronics Segment Sales	$127.5 million	$134.7 million	$(7.2 million)	(5.3%)
Gross Margin	21.2%	20.9%	+0.3%	+1.4%
Material Costs as % of Net Sales	57.3%	59.6%	-2.3%	-3.9%

Stoneridge, Inc. (SRI) - Business Model: Customer Relationships

Direct engagement with OEMs for tailored solutions

Stoneridge, Inc. maintains strong relationships with Original Equipment Manufacturers (OEMs) to deliver customized solutions that meet specific client needs. In 2024, the company reported net sales of $690.0 million, with the Electronics segment contributing approximately 61.3% of this total, reflecting the importance of tailored solutions for OEMs in the automotive and commercial vehicle markets.

Support through after-sales service and maintenance

The company emphasizes robust after-sales support, which is critical for customer retention and satisfaction. For the nine months ended September 30, 2024, Stoneridge incurred $53.7 million in Design and Development costs, which includes expenses related to after-sales support. This reflects an ongoing commitment to ensuring that products perform optimally post-sale, enhancing the customer experience.

Building long-term partnerships with clients

Stoneridge focuses on developing long-term partnerships with its clients, which is evidenced by the operating income reported across its segments. In the first nine months of 2024, the Control Devices segment reported an operating income of $8.0 million, while the Electronics segment saw an increase in operating income to $20.4 million. Such financial stability indicates successful long-term engagements with clients across various sectors.

Regular communication for feedback and product improvement

Regular communication with customers is a cornerstone of Stoneridge's strategy. The company actively seeks feedback to drive product improvements. For instance, the decrease in selling, general, and administrative expenses by $2.6 million in 2024 compared to 2023 demonstrates efficiency improvements likely driven by customer feedback. This proactive approach to communication not only enhances product offerings but also strengthens customer loyalty.

Segment	Net Sales (2024)	Operating Income (2024)	Design and Development Costs (2024)
Control Devices	$230.2 million	$8.0 million	$17.6 million
Electronics	$422.8 million	$20.4 million	$53.7 million
Stoneridge Brazil	$37.1 million	$0.9 million	N/A
Total	$690.0 million	$4.1 million	N/A

In summary, Stoneridge, Inc. employs a multifaceted approach to customer relationships that includes direct engagement, comprehensive support services, long-term partnerships, and continuous communication for feedback. This strategy is reflected in the company's financial performance and operational metrics as of 2024.

Stoneridge, Inc. (SRI) - Business Model: Channels

Direct sales to OEMs and Tier 1 suppliers

Stoneridge, Inc. primarily engages in direct sales to Original Equipment Manufacturers (OEMs) and Tier 1 suppliers. For the nine months ended September 30, 2024, the Control Devices segment reported net sales of $230.2 million, representing a decrease of 13.9% from $267.4 million in the same period of 2023. This decline was attributed to lower customer volumes, particularly in the North American automotive market, which decreased by $44 million.

Aftermarket sales through distributors

The aftermarket segment also plays a significant role in Stoneridge's sales strategy. In the third quarter of 2024, the total net sales from the Stoneridge Brazil segment, which includes aftermarket products, were reported at $13.2 million, a decrease of 6.7% compared to $14.2 million in the third quarter of 2023. The decrease was affected by unfavorable foreign currency translations and lower monitoring service fees, although this was offset by higher OEM and aftermarket product sales.

Online platforms for product information and inquiries

Stoneridge utilizes online platforms to enhance customer engagement and provide product information. While specific revenue figures from online platforms are not disclosed, the company emphasizes the importance of digital channels in facilitating inquiries and product information dissemination. This approach aligns with industry trends where digital communication becomes increasingly vital.

Trade shows and industry events for visibility

Participation in trade shows and industry events is a critical channel for Stoneridge to showcase its products and innovations. The company continues to invest in visibility at these events to strengthen its market presence. This strategy supports its positioning in the automotive and commercial vehicle markets, directly influencing customer engagement and sales opportunities.

Channel Type	Net Sales (2024)	Net Sales (2023)	Percent Change
Direct sales to OEMs and Tier 1 suppliers	$230.2 million	$267.4 million	-13.9%
Aftermarket sales through distributors	$13.2 million	$14.2 million	-6.7%
Online platforms	N/A	N/A	N/A
Trade shows and industry events	N/A	N/A	N/A

Stoneridge, Inc. (SRI) - Business Model: Customer Segments

Automotive manufacturers in North America and Europe

Stoneridge, Inc. primarily serves major automotive manufacturers in North America and Europe. In the third quarter of 2024, net sales in North America amounted to $109.4 million, which represented 51.1% of total net sales. The expected production volume for the North American automotive market is projected to slightly decrease from 15.6 million units in 2023 to 15.5 million units in 2024. The Control Devices segment, which caters to this customer base, reported a decrease in net sales of $16.2 million due to lower customer volumes, particularly in electronic and hybrid vehicle platforms.

Commercial vehicle manufacturers and operators

Stoneridge's Electronics segment is significantly focused on commercial vehicle manufacturers and operators. The segment’s net sales in North America were impacted by lower production volumes, leading to a decrease of $1.7 million in the third quarter of 2024 compared to the previous year. The commercial vehicle market is anticipated to grow, with IHS Market forecasting a 4.4% increase in volumes for North America in 2025. In total, net sales in the Electronics segment reached $127.5 million, accounting for 59.6% of total net sales, despite a 5.3% decrease from the previous year.

Agricultural and off-highway vehicle markets

Stoneridge also targets the agricultural and off-highway vehicle markets, which contribute to its Electronics segment. Sales in the European off-highway vehicle market saw a decline of $4.5 million in the third quarter of 2024 compared to the same period in 2023. The overall net sales for Stoneridge Brazil, which includes off-highway vehicle components, reached $13.2 million in Q3 2024, down 6.7% from the prior year. This indicates a challenging environment in these segments, yet Stoneridge remains focused on expanding its product offerings in this area.

End consumers in South America for aftermarket products

In South America, Stoneridge caters to end consumers through aftermarket products. The net sales recorded for the Stoneridge Brazil segment in the third quarter of 2024 were $13.2 million. This segment experienced a decline primarily due to unfavorable foreign currency translation and lower monitoring service fees, although it saw an increase in OEM and aftermarket product sales. The aftermarket segment is vital for sustaining revenue growth, especially as the company navigates foreign exchange challenges and market fluctuations.

Customer Segment	Net Sales Q3 2024 (in millions)	Percentage of Total Sales	Year-over-Year Change
North American Automotive Manufacturers	$109.4	51.1%	-13.5%
Commercial Vehicle Manufacturers	$127.5	59.6%	-5.3%
Agricultural & Off-Highway Vehicles	Data not specified	Data not specified	-4.5 million (off-highway market)
South America Aftermarket Products	$13.2	6.2%	-6.7%

Stoneridge, Inc. (SRI) - Business Model: Cost Structure

Manufacturing and production costs

The cost of goods sold (COGS) for Stoneridge, Inc. for the nine months ended September 30, 2024, was $543.5 million, representing 78.8% of net sales, a decrease from $590.5 million, or 79.1% of net sales, for the same period in 2023. The material cost as a percentage of net sales decreased from 59.6% in the first nine months of 2023 to 57.3% in the first nine months of 2024. Overhead as a percentage of net sales increased from 14.6% to 16.7% during the same period.

Research and development expenditures

Design and development (D&D) costs for the nine months ended September 30, 2024, totaled $53.7 million, a decrease of $3.8 million from $57.5 million in the previous year. This reduction was attributed to lower launch activities and decreased consulting and wage expenses, partially offset by higher Electronics business realignment costs. For the third quarter of 2024, D&D costs were reported at $17.6 million.

Selling, general, and administrative expenses

Selling, general, and administrative (SG&A) expenses for Stoneridge decreased to $88.8 million for the nine months ended September 30, 2024, down from $91.5 million in 2023. For the third quarter of 2024, SG&A expenses were reported at $26.5 million, a decrease from $28.1 million in the same quarter of 2023. This decrease was primarily driven by lower consulting fees, business realignment costs, and incentive compensation, although there were increases in self-insured medical costs and legal fees.

Costs associated with supply chain management

Stoneridge's supply chain costs were influenced by the impact of required electronic component spot buy purchases, which increased COGS by $14.4 million, or 1.9% of sales, for the first nine months of 2023. The company has also focused on operational excellence and cost reduction strategies, including material cost reduction plans to enhance margins. The overall supply chain management costs, particularly in the Electronics segment, were also affected by foreign exchange variances that influenced material costs.

Cost Category	2024 (9 Months)	2023 (9 Months)	Change ($)	Percentage Change (%)
Cost of Goods Sold	$543.5 million	$590.5 million	$(47.0) million	(7.5)%
Material Cost (% of Net Sales)	57.3%	59.6%	-	-
Overhead (% of Net Sales)	16.7%	14.6%	-	-
Design & Development Costs	$53.7 million	$57.5 million	$(3.8) million	(6.6)%
SG&A Expenses	$88.8 million	$91.5 million	$(2.7) million	(2.9)%

Stoneridge, Inc. (SRI) - Business Model: Revenue Streams

Sales of control devices and electronic systems

Stoneridge's Control Devices segment generated net sales of $230.2 million for the nine months ended September 30, 2024, a decrease of 13.9% compared to $267.4 million in the same period of 2023 . The decrease was primarily due to lower customer volumes in the North American automotive market, which saw a decline of $44 million, and a reduction in the China commercial vehicle market of $3.2 million .

Revenue from aftermarket products and services

In the Stoneridge Brazil segment, net sales for aftermarket products increased, while OEM product sales and monitoring service fees were lower. The total net sales for Stoneridge Brazil for the nine months ended September 30, 2024, were $37.1 million, down from $43.3 million in the same period of 2023, reflecting a 14.4% decrease .

Contracts with OEMs for customized solutions

Stoneridge's Electronics segment saw net sales of $422.8 million for the nine months ended September 30, 2024, which was a 2.9% decrease from $435.6 million in 2023. This segment includes contracts with OEMs for customized electronic systems . The decline was attributed to lower sales in European off-highway vehicle and agricultural markets, offset by increased sales in North American commercial vehicles .

Monitoring services and vehicle tracking solutions in Brazil

Stoneridge Brazil specializes in vehicle tracking devices and monitoring services. For the nine months ended September 30, 2024, monitoring services and tracking devices saw reduced sales, contributing to the overall decline in net sales for the Brazil segment . The specific revenue from monitoring services was not disclosed but was noted as a factor in the overall decrease in sales for the region.

Revenue Stream	Q3 2024 Net Sales (in millions)	Q3 2023 Net Sales (in millions)	Change (%)
Control Devices	$73.1	$89.3	-18.1%
Electronics	$127.5	$134.7	-5.3%
Stoneridge Brazil	$13.2	$14.2	-6.7%
Total Net Sales	$213.8	$238.2	-10.2%

Article updated on 8 Nov 2024

Resources:

1. Stoneridge, Inc. (SRI) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Stoneridge, Inc. (SRI)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Stoneridge, Inc. (SRI)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.