Auto seat and electronics specialist Lear has said it expects a further downturn in the North America market to hurt overall sales and core operating earnings in 2008.
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It has forecast earnings of $US660m to $700m this year, excluding interest, taxes, restructuring costs and other special items after posting a comparable profit of $748.5m in 2007, the Associated Press repported.
According to AP, Lear predicted sales of about $15bn, which is nearly $1bn, or 6.2% less than in 2007. It expects to add new business world-wide and receive added value from a declining dollar, but said lower production in North America will “more than offset” those gains.
Analysts polled by Thomson Financial expect operating earnings of $645.7m on sales of $15.1bn, the Associated Press said.
Lear expects European auto makers to produce 20.1m cars and trucks in 2008 compared with 14.4m units in North America – it expects production from Detroit’s Big Three to fall about 9%, the news agency noted.
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By GlobalData
According to AP, the company – restructuring its North American manufacturing operations to match changing demand from automakers – forecast associated costs of about $100m compared with $204.9m for such special items in 2007. It said expenses for taxes as well as depreciation and amortisation would rise, but interest expenses would fall.
Lear plans to spend $255m to $275m on capital projects this year, up from $202.2m in 2007, the Associated Press added.
