Climate Change Data

Environmental Metrics

ESG Focus Areas

• Sustainability
• Ethical Standards
• Safety

Environmental Achievements

• Obtained ISO 14001 certification at all facilities
• Environmental waste management process involves regular auditing of hazardous waste accumulation points, hazardous waste activities, authorized treatment, and storage and disposal facilities.
• All manufacturing employees are trained on waste management and other environmental issues.

Social Achievements

• At the 22nd Annual National Industrial Meeting, our facilities in Matamoros and Monterrey were honored for their commitment to high ethical standards, practices, and sustainability in our Mexican plants.
• Continued to invest in developing our organizational capabilities by expanding our annual leadership development program, Front Line Leader development, technical training programs, internships, and government training grants.
• Safety of the Company's workforce is a top priority with continued improvement in the Company's safety record. The Company utilizes behavior-based safety programs at all global facilities as a proactive method of increasing safe behaviors.
• Company is committed to diversity, equity and inclusion, including a focus on continued diversity of our Board of Directors and leadership team. The Company has implemented initiatives to help maintain a workforce that represents diversity and inclusion.
• Offers learning and development opportunities throughout the workforce, including a comprehensive leadership program for high-potential employees identified through our succession and talent planning process.
• Employee engagement surveys are conducted to understand employee satisfaction and provide opportunities to create action plans to improve our workplace culture and employee retention.

Governance Achievements

• Issued Core’s inaugural 2022 Sustainability Report and our second publication will be in April of 2024.
• Company's full Board provides oversight of the Company's environmental and climate matters through an Enterprise Risk Management system and quarterly reporting process.

Climate Goals & Targets

Environmental Challenges

• Higher customer demand levels in the first half of 2023 resulted in customer inventory levels becoming overbuilt. In the second half of the year, customers reduced demand as they worked through the excess inventory levels.
• Customers, primarily in the industrial and utilities markets, are working through excess inventory coming into 2024, and demand may recover from low sales levels in the first half of 2024.
• Cyclical demand slowdown in truck market, stabilizing customer inventories, and consumer demand consistent with pre-pandemic levels.
• Industry projections for 2024 in the North American Class 8 truck market call for a cyclical correction in 2024 compared to 2023, with expectations for truck demand to rebound in 2025 and 2026.
• Price increases in raw materials and availability of raw materials, including disruptions in supply chain.
• Long-term fixed price customer contracts could adversely impact operating results in an inflationary economy.
• Cost reduction and quality improvement initiatives by original equipment manufacturers.
• Highly competitive markets.
• Inability to meet customers' on-time demand for products.
• Increasing competition for highly skilled and talented workers, as well as labor shortages.
• Work stoppages or other labor issues at our facilities or at our customers' facilities.
• Risks associated with manufacturing equipment and infrastructure.
• Risks associated with new business awards.
• Risks associated with acquisitions.
• Inability to meet future capital requirements.
• Expected efficiencies related to the proximity of our customers' production facilities to our manufacturing facilities, or with respect to existing or future production relocation plans.
• Products may be rendered obsolete or less attractive if there are changes in technology, regulatory requirements, or competitive processes.
• Fluctuations in foreign currency exchange rates.
• Stock price volatility.
• Impairment charges on goodwill or other intangible assets.
• Maintaining effective internal control over financial reporting.
• Failure to comply with debt covenants.
• Changes in legal, regulatory, and social responses to climate change.
• Product liability claims, recalls, or warranty claims.
• Inadequate insurance coverage.
• Environmental, occupational health, and safety rules and regulations.
• Costly severance arrangements with senior management employees.
• Provision for income tax, adverse tax audits, or changes in tax policy.
• Cybersecurity incidents.

Mitigation Strategies

• Successfully executed the Company’s strategic initiatives and ‘Must Win Battle’ projects to significantly improve our operational performance and improve our market pricing.
• Operational performance metric improvements for the full year exceeded our target of 20% and created the additional capacity we originally stated at the beginning of 2023.
• Formalized and implemented company-wide continuous improvement systems.
• Strengthened the balance sheet with a debt to trailing twelve months EBITDA ratio of less than 1 times and available liquidity of $74 million.
• Have the organizational capabilities to continually improve and grow our existing business and acquire businesses that would benefit from our operational and business systems or more importantly provide diversification in our sales channels where we can grow wallet share with our large breadth of materials and processes.
• Sales strategy remains intact with the primary driver being to continue to diversify our customer base through technical solution sales that provide our customers with unique solutions and value to their challenges.
• Current focus is on leveraging what we have already created in order to drive growth.
• Actively bidding for new Volvo business.
• Raw material supply chains remain stable.
• Does not anticipate challenges in hiring hourly labor.
• Maintains property and business interruption insurance.
• Maintains a cyber risk management program.
• Maintains several processes intended to safeguard our information systems, protect the integrity of our data and respond to cybersecurity incidents.

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Changes in weather severity

Transition Risks

• Changes in legal, regulatory, and social responses to climate change, including any possible effect on energy prices

Awards & Recognition

• EcoVadis Bronze status
• Material and Process Innovation Award nomination