Scot Duncan, Partner
The automotive industry is going through an era of drastic transformation with the advent of connected vehicles, ride-sharing (multi-modal mobility), autonomous and electric vehicles. Although the transformation has brought in a host of opportunities for companies, many of the traditional players—the legacy OEMs and tiered suppliers—are finding it challenging to adopt new technologies and business structures. These changes often impact their research and innovation areas, manufacturing modalities, and resource consumption patterns as it requires a huge capital investment. On top of it, the ongoing pandemic situation is forcing automotive players to halt their investment towards innovations and digital transformation for sustaining themselves. The story of DURA, a renowned global automotive supplier, was not different.
Operating as a global automotive supplier, DURA is recognized by leading vehicle manufacturers as the preferred supplier partner for innovative, highly integrated, mechatronic systems and lightweight solutions. Over the last few years, the company has invested heavily to become a significant player in the evolution of mobility and enable superior performance and value creation through its cutting edge technology. DURA even acquired huge contracts from automotive OEMs. Still, as the next step in their growth trajectory, DURA realized a need to invest over $180 million over the next 24 months to deliver the new upgraded products. That’s where MiddleGround Capital, a private equity firm that makes control equity investments in lower middle-market North American companies in the B2B industrial and specialty distribution sectors, came in. “We had been searching for an opportunity to invest in a business as well-positioned as DURA to capitalize on the most disruptive trends in the automotive industry. From today’s focus on electrification of the powertrain and vehicle lightweighting to some of the longer-term shifts toward autonomous driving and connected car, DURA is and will continue to be a driving force in an industry undergoing major transformation. We are delighted to support DURA on its journey,” says John Stewart, partner at MiddleGround Capital, who has spent 18 years of his career at Toyota Motor Company.
Scot Duncan, partner at MiddleGround Capital who spent 13 years at Toyota Motor Company in assembly engineering, maintenance, and production management, adds, “DURA’s engineering capabilities have made it a key supplier to its customer base for many decades. We are excited to further Dura’s legacy of partnering with its customers to develop next generation products of superior quality. We value the support Dura’s customers have shown over the years and look forward to working together on this next phase of growth.”
Creating the Future in Vehicle Safety and Electrification
At its core, DURA Automotive Systems—MiddleGround’s sixth platform acquisition—is a global automotive supplier specializing in the design, engineering, and manufacturing of solutions that drive the evolution of mobility. With a legacy of more than 100 years of inspired invention, the company is recognized by leading vehicle manufacturers as the preferred supplier partner for innovative, highly integrated, mechatronic systems and lightweight solutions.
We Had Been Searching for an Opportunity to Invest in a Business as Well-Positioned as Dura to Capitalize on the Most Disruptive Trends in the Automotive Industry
DURA’s forward-thinking technology roadmap includes mechatronic control systems, shift-by-wire systems, electronic systems, actuators, advanced driver assist systems (ADAS), lightweight structural body systems, electric vehicle battery trays, and exterior systems, including roof rails and electronic-infused exterior trim.
MiddleGround aims to support Dura’s roadmap, and one major step toward the direction was assessing the management team and appointing an industry veteran, Kimberly Rodriguez, as DURA’s CEO. “I am thrilled to join such a talented organization. The dedication and tenacity of our 6,700 global team members has strategically positioned the company for ongoing success. As advanced mobility continues to evolve, we look forward to collaborating with industry thought leaders to create the future in vehicle safety and electrification,” says Kimberly.
The Four Pillars of Technological Evolution
What makes DURA excel in the market is its four pillars of technological evolution, which define a winning strategy. Each pillar drives advancements across the company’s entire product portfolio. From the ultra lightweighting of structures to mechatronics, DURA’s reinvented product offerings deliver premier aesthetics, advanced electronic features, and enhanced value to satisfy evolving consumer needs.
The first pillar, known as vehicle structures and systems, delivers smart combinations of aluminum castings, stretch-bended profiles, composite materials, and high strength alloys. The result is module optimization, engineered to provide the perfect fusion of function, form, and sustainable performance. Working in unison, DURA’s computer analysis teams and its in-house German tool makers and assembly artisans craft the perfect architecture. “DURA’s world-class manufacturing processes and tooling expertise combine a host of precision processes, from roll-forming, stretch bending, hydroforming and CNC Machining, through precision laser welding,” says Stewart. MiddleGround is partnering with DURA to ramp up four facilities to create and deliver state-of-art and precise technology.
The mechatronic systems form the second pillar of DURA’s technological evolution. Engineered to deliver tailored driving experiences, the company’s mechatronic systems leverage in-house design and manufacture of advanced lightweight housings, software, gear trains, and embedded electronics. DURA’s mechatronic actuation systems support driver-assist through autonomous mobility, and its complete portfolio of compact actuators boast ultra-lightweight design while minimizing operating effort and maximizing torque.
Through the company’s third pillar, exterior trim, DURA delivers maximum durability with each new creation. Extending the customer experience beyond visual aesthetics, DURA intelligent sensors and display technologies bring innovation to the surface.
John Stewart, Partner and Co-Founder
The company’s portfolio of injection molded electronics offers ultra-thin profiles and premium protection from environmental elements. “DURA’s reputation as toolmakers and our craftsmanship skills in stretch-bending unique profiles make us the preferred partner for premium vehicle designers,” mentions Duncan. Lastly, DURA’s Active Safety pillar delivers AVA, the revolutionary Autonomous Vehicle Assistant. This autonomous driving platform is purpose-built with a distinctly secure, open architecture to simplify scalability to high-level autonomous capabilities.
Delivering Superior Performance and Creating Value
Through the four pillars of technological evolution and the support of MiddleGround, DURA’s manufacturing and technology footprint is continuously evolving to provide customers with exceptional local and global-platform support across North America, South America, Europe, and Asia.
“We make control equity investments in businesses that can benefit from the hands-on operational expertise we bring to the table. We partner and align ourselves with management teams to execute a customized value creation program that drives equity value back to our investors as well as management,” mentions Duncan. “At MiddleGround, we are creating a culture that relies on participative management to empower and motivate each other.”
"We Value the Support Dura’s Customers Have Shown Over the Years and Look Forward to Working Together on this Next Phase of Growth"
As DURA’s global and talented teams move forward with exceptional products, MiddleGround will be helping them in this co-development process. Stewart adds, “Operational excellence is built upon proficiency and relentless discipline across five DURA principles; people involvement, standardization, built-in quality, short lead time, and continuous improvement.” To this end, the company follows a Plan, Do, Check, Act (PDCA) philosophy that drives policy, process, and procedures to heightened levels, enabling consistent practices and behaviors to achieve ever-improving performance.
With the help of MiddleGround, DURA has recently launched a facility in the Czech Republic. The company will soon be opening three facilities in Macedonia, Europe, and Muscle Shoals, Alabama, employing between 500 and 700 people over the next 18 to 24 months. They are also looking at opportunities to integrate the business vertically and find extrusion and anodizing solutions that could be brought in-house. “We believe that extruded aluminum is going to be a key part of the technology that the company uses on a go-forward basis, and we would like to be able to have that capability in-house, going forward,” mentions Stewart.
Duncan further mentions that DURA continues to work on relationships in the supply chain and will continue to grow its partnerships with key vendors and OEM customers. “We will make sure that we continue to be a valued, and stable component in the complete supply chain and automotive,” he concludes.