GKN has reported first quarter automotive production up 50%, with all major markets showing improvement.
First quarter sales – including powder metallurgy – rose 50% to GBP852m (US$1.3bn) with trading profit up to GBP51m compared to GBP47m last year.
Underlying sales increased by 54%, while overall automotive margins improved to 6%.
GKN is forecasting automotive global production increasing from 65m vehicles to around 68m models, although second quarter output and global production is expected to be down.
Raw material costs, particularly scrap steel, have risen significantly in recent months and although increases will be largely recovered from customers, GKN says “there will be some mismatch in timing.”
A statement from the engineering group notes: “GKN’s second quarter automotive including powder metallurgy sales are expected to be similar to the first quarter.
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“Visibility of customer schedules and intentions beyond the half year remain somewhat limited, although we do expect some reductions in second half sales from first half levels.”