Valeo has forecast worldwide car production down 17% this year instead of the 20% it had earlier predicted.

The revised outlook came as it reported a second quarter net  loss of EUR54m (US$76.39m). First half sales fell 28.4% to EUR3.74bn.

Valeo predicted a rebound in vehicle production in the  third quarter “through the combined impact of incentive programmes for new vehicles in Europe and the return to growth in emerging markets.”

The company added it had shed 4,500 of the 5,000 workers it announced would go at the end of 2008.