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Elkhart caught in headlights of car recall

Toyota's sweeping auto recall hit home in Elkhart this week as a local manufacturing heavyweight was identified as the maker of the problematic gas pedal used in some 2.4 million vehicles.
Elkhart-based CTS Corp. made its best effort at damage control in the wake of the revelation, noting that the faulty parts have not been linked to any accidents or injuries.
As The Elkhart Truth reported, CTS CEO Vinod Khilnani told analysts on an earnings call Thursday that CTS has been working with Toyota to redesign the pedal part to meet tougher standards and that "three or four" CTS plants are already producing the newer pedals.
Khilnani also tried to downplay news that Ford Motor Co. has stopped producing a commercial van that it makes in a venture with Jiangling Motors Corp. in China because the vehicle uses a pedal of a different design produced by CTS.
CTS was suffering from the harsh economy before the recall, along with most of the auto industry. Revenues for 2009 were down 28 percent compared to 2008, to $499 million, the company reported on Wednesday.
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Khilnani focused his comments on the "momentum" of the third and fourth quarter, achieved in part because of salary and benefit reductions in 2009. As the recession eases, CTS management projected full-year 2010 sales to increase 10 percent to 15 percent over 2009.
As for the recall, Khilnani said that he did not believe that "when the dust settles" it would hurt the company's results in 2010.
CTS has 19 manufacturing facilities in the United States, Canada, China, Mexico and the Czech Republic, producing automotive parts as well as components used in telecommunication systems, medical devices and military equipment.