Strattec Security Targets Margin Gains, New Customers and Digital Key Growth

Strattec Security Targets Margin Gains, New Customers and Digital Key Growth

Strattec Security Targets Margin Gains, New Customers and Digital Key Growth Written by MarketBeat August 29, 2026 Add As Preferred Source Share Share Share This Article Link copied to clipboard. Close Image from MarketBeat Media, LLC. Strattec Security NASDAQ: STRT is pursuing a multiyear transformation aimed at improving margins, expanding its customer base and modernizing operations, President and CEO Jennifer Slater said during a company presentation. The automotive access and security supplier has been publicly traded since 1995 and has approximately 4 million shares outstanding, with institutional investors owning about 89% of the company, Slater said. Ford, General Motors and Stellantis account for 65% of Strattec’s sales. Get Strattec Security alerts: Sign Up Strattec operates from its headquarters in Milwaukee, Wisconsin; a commercial and development location in Auburn Hills, Michigan; four manufacturing facilities in Mexico; and a distribution operation in El Paso, Texas. Its product portfolio is organized around permission products, including locks, keys, handles and key fobs; motion products such as rear-access and power sliding-door actuators; and hold products, including manual, hood and cinching latches. Technology and Customer Expansion Slater said the company is developing next-generation digital key fobs using ultra-wideband technology rather than RFID technology. While consumers increasingly use phones for vehicle access, she said consumers continue to value physical fobs for security and transferability. Strattec is also working to engage automakers earlier in vehicle development, rather than focusing primarily on the request-for-quote stage. Because automotive programs can take two to three years to launch after an RFQ, Slater said earlier engagement could help the company better align its technology with customer vehicle plans. The company is seeking to diversify beyond its traditional Detroit automaker customer base. Slater said North American vehicle production is expected to decline 2% by the company’s fiscal 2027, while production among its addressable traditional customers is expected to decline 6%. However, she said regional sourcing trends could create opportunities with a broader set of manufacturers. Strattec currently has some business with Hyundai-Kia, including power sliding doors manufactured in Mexico and shipped to Korea for Korean vehicle production. Slater said the company is discussing opportunities to support Hyundai-Kia in North America and is pursuing relationships with additional customers that are reassessing regional supply chains. Transformation Actions and Financial Results Slater characterized the company’s transformation as still being in its early stages. Initiatives have included adding a new executive team, identifying capability gaps throughout the organization and increasing collaboration among its manufacturing sites. She said the company earlier rebranded both its corporate identity and cultural priorities around innovation, collaboration and accountability. Operationally, Strattec reduced headcount by 21% over the past two years, generating $9.5 million in savings, according to Slater. The company also automated 16 individual workstations during the past year, though its overall automation level is still approximately 9%. Pricing actions have generated $15.6 million, she said, though the company expects future pricing gains to be less significant after capturing larger initial opportunities. Strattec also has been upgrading internal technology systems, replacing paper-based expense reporting and benefits enrollment processes. For its most recently discussed quarter, sales were relatively flat from the prior year. Pricing benefits of $1.4 million were offset by customer electric-vehicle program cancellations, Slater said. She said the company is largely past the year-over-year effects of those cancellations. Gross margin expanded to 16.5% from 15.0%, driven by pricing an...