Valeo has stopped selling major assets after its new CEO halted his predecessor’s plan.
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“There is no disposals target,” Jacques Aschenbroich, CEO since March, told Reuters at the Frankfurt show. “Today, I make it clear that we do not want to sell major assets.”
His predecessor, Thierry Morin, had said in 2007 he would sell of units worth EUR2bn in sales by 2010 and the group has so far managed around half of this, ditching electric motor, truck engine cooling and wiring units.
“Selling assets is the consequence of strategy and not a strategy in itself,” Aschenbroich said, adding that the group’s businesses were “complementary”.
“If there are good opportunities and I think our financial situation will get stronger in the months and years to come, we will make strategic moves,” he said.
Aschenbroich also said the market was looking better than at half year results time at the end of July when it said it had little idea on what would happen in the fourth quarter.
“Things today are very different. The third quarter is in line with what we had imagined, indeed a bit better,” he said. “The fourth quarter, despite the end of the scrapping schemes, is looking noticeably better than what we could have imagined at the end of July.” However, the market in 2010 would be lower after scrapping schemes end, he said.
“The problem in 2010 will be North America and Europe,” he said, citing strong growth in emerging regions.
Valeo could still see an increase in its own production in 2010, however, as there would not be a repeat of the dramatic slashing of inventories that took place in 2009 representing around an 8% cut in production, Aschenbroich told Reuters.
“Even if next year new car sales are stable, that would mean for us an 8% increase in production. For us, 2009 production, in my opinion, represents a low. I expect something better for next year, because of this destocking effect that won’t be repeated.”
He added it was too early to estimate a precise production level.
