Auto parts makers expanding beyond traditional markets
AURORA, Ont.: Magna International Inc. is raising sales predictions by as much as 8% in 2012 as the auto parts maker looks to new markets for growth.
The company, which reports in US dollars, said it expects total consolidated sales this year to come in between US$27.8 billion and $29.3 billion. The outlook is above a forecast range of $25.6 billion to $27.1 billion made previously for fiscal 2011.
Magna said operating margins are targeted at about 5%, an improvement over the scaled back predictions of 4.75% made for 2011.
“Our outlook demonstrates the traction we are gaining in executing our plan to expand our business outside of our traditional markets,” said CEO Don Walker. “We are taking advantage of the growth opportunities in new markets and positioning Magna to further serve our customers on global platforms.”
Magna said the higher 2012 projection is based on light vehicle production of about 13.6 million units in North America and 13 million in Europe.
The Aurora, Ont.-based auto parts giant also expects complete vehicle assembly sales to be between $2.3 billion and $2.6 billion.
Spending on fixed assets is expected to be between $1.3 billion and $1.5 billion. Magna said this amount reflects investment to expand in a number of high-growth markets while continuing investment in its traditional markets.
Looking at 2012 to 2014, Magna expects a sales increase of $3.2 billion, based on 2014 light vehicle volumes of 15.4 million units in North America and 14.2 million units in Western Europe. The split worldwide is expected to be 50% in North America, 15% in Europe and 35% in the rest of the world.
Magna has over 107,000 employees at 286 sites in 25 countries.
© 2012 The Canadian Press, Files from PLANT