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Trane Technologies: Covid-19 Impact Analysis
Key Takeaways
- In June 2020, Trane Technology placed two of its business units, Aldrich Pump LLC and Murray Boiler LLC, into bankruptcy to deal with legal legacy asbestos liabilities and growing legal asbestos claims.
- The impact of COVID-19 on Trane Technologies includes lower revenue, facility closures in some regions, unfavorable foreign exchange rate movement, among others.
- Some of the measures the companies took include cost-cutting measures, introducing innovative solutions, increased investment in employee health and safety, among others.
Introduction
Trane Technologies faced several COVID-19-related challenges such as supply chain challenges, facility closure in some regions, resource constraints, lower revenue, among others. The only other major event that affected Trane Technologies' business operations between Q2 2020 and Q3 2021 is the filing of bankruptcy for two of its business units due to asbestos claims. Additional details, including actions taken by the company to mitigate the impact of COVID-19, are provided in the attached spreadsheet.
Some Selected Findings
- Temporal facility closure in the Asia Pacific region IN Q2 of 2020 negatively impacted operations in the Americas and EMEA regions.
- To mitigate COVID-19-related challenges, the company increased focus and investment in the health and safety of its employees and customer.
- The company also faced significant employee absenteeism due to COVID-19-related illness in the fourth quarter of 2020.
- In the first quarter of 2021, Trane Technologies faced increased material and component costs.
- Trane Technologies increased the prices of its products and services and focused on higher-margin sales to mitigate the effect of rapid price increases in the cost of materials and components in the first quarter of 2021.
- In general, Trane Technologies' executives focused on discussing the innovative solutions they have developed to solve COVID-19-related challenges, than the challenges themselves in various interviews between Q2 2020 and Q3 2021.
Research Strategy
To provide an analysis surrounding the impact of Covid-19 and other significant events on Trane Technologies' business operations, we focused on finding information from the company. We relied on quarterly and annual filings published by the companies. We also reviewed interviews and publications from the company's executives in each quarter. We have also relied on analysis by industry experts, news/press reports, and industry publications where relevant. In some cases, the challenges the company faced in two quarters were identical and we have reported it as such. Our research also revealed that the company only faced one additional significant event apart from COVID-19 between Q2 2020 and Q3 2023. This is captured in the company's annual report which has a section for significant events that affected the company in a given year.