Cooper Power Systems’ business model is based upon long-term commitments to its customers. The Cooper Product Index (CPI) is a price adjustment mechanism Cooper Power Systems (CPS) utilizes on term/blanket contracts to equitably share the risks of commodity volatility. CPS is developing CPI models representing different products and therefore, unique component pricing, component weights and base period effectivity dates. All models share the common goal of reducing the risk to customers during periods of accelerating costs. Due to the nature of the indices they are not intended to cover all market and cost volatility, but rather smooth pricing impact and cost impact for both our customers and Cooper.
All CPI models have the following in common:
| Publication Date | Periods Used in Calculation |
Applied to Shipment; Start/Stop Date |
|---|---|---|
|
Mid-March |
Base Period - Feb. |
April 1 - June 30 |
|
Mid-June |
Base Period - May |
July 1 - Sept. 30 |
|
Mid-September |
Base Period - Aug. |
Oct. 1 - Dec. 31 |
|
Mid-December |
Base Period - Nov. |
Jan. 1 - March 31 |
Cooper Power Systems reserves the right, at their discretion,
to alter the update frequency to accommodate market conditions.
Cooper Power Systems is committed to ensuring our customers receive complete, accurate and timely responses, this includes information surrounding our pricing indices. To improve this process and ensure you receive the latest price index data, we are removing the reference to a single price index on our website and replacing this with quarterly direct correspondence to each of you.
Your Cooper Power Systems Inside Sales Rep (ISR) at our Customer Service Center will e-mail you the index charts and tables similar to what we have previously displayed on the website. You will receive this quarterly per the index schedule.
Ensure Cooper Power Systems has your correct contact information for the quarterly updates by contacting your ISR at Cooper Power Systems.
The Base Period for the material components and the Energy Index in the CPI–3 model is year-end 2008.
The price adjustment calculation is based upon the percentage content of price for each of the key components. The weighting factors for each product are defined below.
The CPI Calculation: Customer Base Net Price multiplied by (1+CPI Value) = Adjusted Net Price
Example: If customer Base price is $1,000 and the current CPI value is 6.5% the Adjusted Net Price equals $1,065. ($1,000 X 1.065 = $1,065). The incremental price change from the price index is $65.
| Cost Component | Distribution Transformers | Step Voltage Regulators |
|---|---|---|
| Aluminum | 5.00% | 3.60% |
| Carbon Steel | 4.90% | 1.30% |
| Copper | 2.50% | 2.30% |
| Core Steel | 23.80% | 12.20% |
| Dielectric Fluid | 8.40% | 4.90% |
| Energy Index | 7.29% | 7.29% |
| Other Costs | 48.11% | 68.41% |
| 100% | 100% |
Cooper Power Systems is committed to ensuring our customers receive complete, accurate and timely responses, this includes information surrounding our pricing indices. To improve this process and ensure you receive the latest price index data, we are removing the reference to a single price index on our website and replacing this with quarterly direct correspondence to each of you.
Your Cooper Power Systems Inside Sales Rep (ISR) at our Customer Service Center will e-mail you the index charts and tables similar to what we have previously displayed on the website. You will receive this quarterly per the index schedule.
Ensure Cooper Power Systems has your correct contact information for the quarterly updates by contacting your ISR at Cooper Power Systems.
The Base Period for the material components and the Energy Index in the CPI–WE model is year-end 2006.
The price adjustment calculation is based upon the percentage content of price for each of the key components. The weighting factors for each product are defined below.
The CPI Calculation: Customer Base Net Price multiplied by (1+CPI Value) = Adjusted Net Price
Example: If customer Base price is $1,000 and the current CPI value is 6.5% the Adjusted Net Price equals $1,065. ($1,000 X 1.065 = $1,065). The incremental price change from the price index is $65.
| Cost Component | Distribution Transformers | Step Voltage Regulators |
|---|---|---|
| Aluminum | 5.00% | 3.60% |
| Carbon Steel | 4.90% | 1.30% |
| Copper | 2.50% | 2.30% |
| Core Steel | 23.80% | 12.20% |
| Dielectric Fluid | 8.40% | 4.90% |
| Energy Index | 7.29% | 7.29% |
| Other Costs | 48.11% | 68.41% |
| 100% | 100% |
Cooper Power Systems recognizes the need for our customers to feel comfortable the basis for price adjustment is relevant and verifiable to a reasonable extent. Cooper Power Systems has selected primarily third-party sources recognized in this industry as providing reliable information when representing the market prices of material used in Cooper Power Systems’ products.
CPS may need to revise, or change, sources or frequency of published indexes based on availability.
CPS reserves the right, at its discretion, to make these changes.
Envirotemp™ and FR3™ are licensed trademarks of Cargill, Incorporated.
