BorgWarner trims annual sales forecast on expectations of lower vehicle production
Oct 31 (Reuters) -Auto parts supplier BorgWarner BWA.N lowered its full-year sales forecast on Thursday on expectations of lower vehicle production as the industry comes under pressure from consumers cutting back on purchases.
BorgWarner, like other auto suppliers, benefited over the years from automakers ramping up production and making vehicles with more efficient hybrid systems or turbochargers.
However, that pace has slowed as Western automakers navigate a difficult market hindered by weaker consumer demand due to sticky inflation and stiff competition from Chinese companies putting out more affordable electric vehicles.
Earlier this month, auto industry consultants J.D. Power and GlobalData cut their expectations for 2024 global light-vehicle sales by 500,000 units to 88 million units.
BorgWarner's client Ford Motor F.N offered a weak outlook this week, while other major customer Volkswagen VOWG_p.DE asked its workers to take a 10% pay cut as profits plunged to a three-year low.
Both the automakers accounted for roughly 25% of BorgWarner's 2023 sales.
The company expects its net sales for 2024 to be between $14.0 billion and $14.2 billion, compared with its prior forecast range of $14.1 billion to $14.4 billion.
On an adjusted basis, BorgWarner earned $1.09 per share in the third quarter, compared with the average analyst estimate of 92 cents, according to data compiled by LSEG.
Overall revenue in the quarter fell about 5% to $3.45 billion.
Reporting by Nathan Gomes in Bengaluru; Editing by Shounak Dasgupta
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