Forvia trims 2024 outlook on lower auto demand, extra costs in North America
July 24 (Reuters) -European car parts supplier Forvia FRVIA.PA lowered its sales and margin forecasts on Wednesday due to sluggish global auto demand and additional one-off costs in its North American car interior business.
Forvia expects its sales to be at the lower end of its guidance of between 27.5 billion and 28.5 billion euros ($29.8 billion and $30.9 billion) this year. Similarly, its operating margin should come at the bottom end of its 5.6% to 6.4% range.
The outlook is based on the estimated worldwide automotive production of 88.7 million vehicles this year, down 2% compared to 2023, Forvia said in an earnings statement.
"In the first half of the year, the automotive environment was characterized by broadly flat automotive production year-on-year and a slowdown of the pace of electrification in Europe," Forvia said, adding its half-year operating margin was hit by one-off extra costs in the interiors segment in North America due to a problem with a supplier.
Forvia, which supplies parts to Stellantis STLAM.MI, Volkswagen VOWG_p.DE and Ford F.N, and is also active in China, is fighting to recover its margins as the automotive sector grapples with falling auto demand and competition from Chinese manufacturers.
($1 = 0.9219 euros)
Reporting by Nathan Vifflin; editing by Milla Nissi
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.