Harman shares also came under fire two years ago, noted Paliwal, as Google (GOOG) announced its Android smartphones would include maps with turn-by-turn directions. However, since then sales have increased by 20% because Harman was able to integrate the new maps and directions into its existing systems. Paliwal said that more choices for consumers is always a good thing.
Finally, when asked about sales in Europe, Paliwal said they remain strong. The company derives 35% of its total sales from Europe, most of that from Germany.
Cramer said it took guts for Paliwal to appear on Mad Money and refute the negative reports. He remained bullish on the company's prospects.
Weakness at Home, Strength Abroad
In a second "Executive Decision" segment, Cramer spoke with Mike Sutherlin, president and CEO of Joy Global (JOY), the industrial machinery maker whose shares are off 27% so far this year on the weak global economy. During the 2008 and 2009 recession, shares of Joy Global lost 70% of their value on similar concerns.Sutherlin said Joy Global is seeing weakness in the U.S., primarily as coal production has been slowing. But in the rest of the world, demand remains strong as companies and countries are not cutting back on the projects already under construction. This strong demand, he said, is offsetting any U.S. weakness. When asked about that U.S. weakness, Sutherlin said that only about one-third of the decline in cola production has stemmed from utilities closing plants to meet EPA regulations. The other two-thirds, however, stem from short-term economic weakness, something Sutherlin expects to turn around soon. So why should investors believe that Joy Global won't lose the lion's share of its value this time around? Sutherlin said Joy Global still has a 12- to 14-month backlog and, unlike 2008, nearly 60% of the company's revenue now comes from the aftermarket rather than new equipment sales. Joy Global is able to level off any weakness in its revenue, said Sutherlin, all while continuing to grow earnings.
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