You need look no further than Tymphany's PanYu, China manufacturing facility for additional evidence of the merger's benefits. While the transition to China began before DST and Tymphany joined forces, our improved financial strength has also enabled us to make much larger investments in our Chinese production facilities than we could have made as DST alone. As a result, we now have a state-of-the-art manufacturing facility in China that is starting to turn out tweeters and woofers of the highest quality in the world, and that can handle high volume production with ease.
No discussion of manufacturing is complete right now without acknowledging some of the bumps that emerged on the road to establishing a world-class production facility in China. Unfortunately, many of Tymphany's existing customers have experienced some of these bumps on the path to restructuring the manufacturing sites that produce our great audio solutions, but I'm happy to report that the road has finally been smoothed, as the dramatic decrease in customer reported issues can attest. More on that in a minute.
Prior to moving production of our famous Peerless and Peerless v-line brands of audio transducers to China, they were manufactured here in Denmark at our Karlslunde facility. When we moved out of Karlslunde and into our new offices in Taastrup last summer, we transferred Peerless manufacturing to Videbæk, where it would stay until PanYu was fully operational and able to handle a wide variety of product types beyond the tweeters that it was already famous for. Although the manufacturing team in Videbæk is highly skilled, manufacturing is inherently difficult, and the transition from one location to another caused some product and logistics issues that we did not adequately anticipate. To the extent that our customers suffered any inconvenience as a result of this, we are truly sorry and have taken all necessary measures—including the implementation of a company-wide Quality Commitment Program—to prevent this from ever occurring again.
Fortunately, improvements are happening at a rapid pace now, and I'm happy to report a significant down trend in what we refer to as "customer action reports," or CARS. CARS are how we track all customer issues with regards to products and logistics, and after the rough patch that occurred last year following the Karlslunde-to-Videbæk transition, the number of action reports we're receiving is dropping dramatically month to month. By the end of March 2006, CARS were down to levels not seen since the Peerless and Peerless v-line brands were manufactured in Karlslunde. As we transition these brands now from Videbæk to PanYu, we are much better equipped to make this transition as seamless and easy as possible, and the lower CARS rates are indication that we are succeeding.
