(Reuters) -German machine and car parts maker Schaeffler on Wednesday joined other auto suppliers in giving a gloomy outlook for 2025, as it sees no rebound for the automotive market during the year.
Schaeffler Predicts No Recovery for Automotive Market by 2025
(Reuters) -German machine and car parts maker Schaeffler on Wednesday joined other auto suppliers in giving a gloomy outlook for 2025, as it sees no rebound for the automotive market during the year.
Europe's auto sector is being tested by multiple hurdles ranging from high production costs and managing the shift to electric vehicles (EV) to falling demand and rising competition from China.
In particular, Schaeffler sees a negative 2025 operating (EBIT) margin for its e-mobility unit, at -14% to -17%, reflecting the scale of the challenges in the European EV market.
It recently acquired electric powertrain specialist Vitesco as part of a push to increase its electric mobility market share.
"Of course, 2025 will continue to be characterized by volatility. Our cautiously optimistic outlook reflects that," said CEO Klaus Rosenfeld said in a statement.
The German ball-bearings specialist expects global automobile production to contract by 0.5% in 2025.
Schaeffler is carrying out a major restructuring effort that includes cutting thousands of jobs and closing plants across Europe, after its operating margin, a key profitability metric, melted from 7.3% to 4.5% in just one year.
It slashed its dividend by almost a half to 25 euro cents per common share, and forecast an EBIT margin of 3% to 5% for 2025.
(Reporting by Andrey Sychev in Gdansk; editing by Milla Nissi)
