Ontario-based automotive contractor Magna International has cut its annual car production guidance for the year to 12.5mn units in North America and 15.9mn in Europe from 16.3mn and 20.8mn units, respectively.

 

According to Magna, the reduction is the result of uncertainty stemming from COVID-19, manifesting in weaker customer demand and manufacturing in the industry. It also lowered its 2020 CAPEX to approximately $1.4bn.

 

In its H1 earnings report, the company revealed its total equipment sales declined by 60pc to $12.9bn from $20.7bn in the first half of 2019. Body exteriors and structures, the contractor’s largest segment, saw a 38pc drop in sales in H1 to $5.2bn from $8.6bn during H1 2019. 

 

During the second quarter of this year, Magna had similar decline in total sales of 57.8pc, translating to about $4.2bn, from $10.1bn in the same quarter last year. The exteriors and structures category saw a 61pc dive in sales to $1.6bn from $4.2bn in Q2 2019. 

 

The firm posted an EBIT loss of $197mn in the first six months of the year, compared to a profit of $1.4bn in the same period in 2019. Magna’s EBIT loss in Q2 totaled $600mn, down from a profit of $677mn in the second quarter of 2019. 

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