Company News

CORRECTED-UPDATE 1-Canada's Magna lowers production forecast on expected hit from tariffs

(Corrects paragraph 5 to say company’s light vehicle production rose in “first half of 2018”, not “second quarter”)

Aug 8 (Reuters) - Canadian auto parts maker Magna International Inc lowered its full-year production forecast for North America, hurt in part by tariffs imposed by the Trump administration.

The company, which reported second-quarter profit below analysts’ estimates on tepid demand in North America, its biggest market, said it expects light vehicle production in the region to be 17.2 million, down from its previous forecast of 17.3 million.

The Trump administration has come under heavy criticism from automakers, foreign governments and others as it considers tariffs of up to 25 percent on U.S. imports of autos and car parts.

Magna said in May it is “cautiously optimistic” that talks to renegotiate the North American Free Trade Agreement (NAFTA) would result in a competitive trade deal.

During the first half of 2018, Magna’s light vehicle production increased 4 percent in Europe but declined 1 percent in North America.

Magna said total sales during the quarter jumped 12.5 percent to $10.28 billion.

Net income attributable to Magna rose to $626 million or $1.77 per share, in the quarter ended June 30, from $548 million, or $1.44 per share, a year earlier. Excluding items, the company earned $1.67 per share. Analysts, on an average, had expected the company to report a profit of $1.72 on a revenue of $10.51 billion, according to Thomson Reuters I/B/E/S. (Reporting by Anirban Paul in Bengaluru; Editing by Shailesh Kuber)