Gestamp has launched a three-year plan to make the Nafta market (US and Mexico) comparable in profitability to the rest of the group. The company’s 15 plants in the region account for 23% of sales and have an EBITDA margin of 6.7%, compared with 12.6% for the rest of the auto business. Gestamp forecasts a transitional fiscal year 2024 with expected sales growth of 2 or 3%. For the first quarter of the year, the group reduced net profit by 31% to 55 million.
President of Gestamp, Francisco Jose Riberaspresented the development of the company in the framework of the general meeting of shareholders held this Thursday in Bilbao, which approved the accounts for 2023. The auto components maker posted a net profit of $281 million this year, Riberas said. “very positive” in terms of growth, above the market and in terms of profitability, with improving debt levels, financial stability and customer acquisition
and orders.
Gestamp foresees better market development this year with sales growth of 2 or 3%, of which About 23% is already accounted for by electric vehicles.
The president of the Basque group noted that they are involved in the Phoenix plan with the aim of increasing the profitability of some plants located in the United States and Mexico. Gestamp has 15 factories in the Nafta region, where nine of them have adequate results, and six are “significantly below the group average.”
The North American market accounts for 23% of Gestamp’s sales, and the region reported an Ebitda margin of 6.7% compared to the rest of the auto business, which accounted for 12.6%. His goal is to bring the region’s margins to double digits. in 2026. “We can’t afford for it to be below average for the rest of our operations,” he said.
As such, Gestamp will employ a model of oversight of “expert factories” that will act as partners at sites in the US and Mexico to “try to achieve that these factories are reaching the European level As soon as possible”.
50% of electricity production in 2027
Francisco José Riberas recalled that his goal is for half of his sales to be from electric vehicles by 2027, adding that they have already about 23% in this first quarter, which exceeds last year’s percentage. “We are on the right track, by 2027 we will be at 50%, and then the market, of course, will depend on many things, but it will be very close to 40%,” he said.
Riberas recalled that last year 17.3 million electric vehicles produced, growth was 35% and occurs mainly in China. In his opinion, this process of electrification “cannot be stopped.”
The manager explained that in the first quarter of 2024 they “were able to It’s good to grow in China, which is a very difficult market.”
and “good and profitable growth” as well as acquiring new customers in this market.
At market close, Gestamp presented results for January-March from Drop in net profit by 31%, up to 55 million, compared to the same period the previous year. Revenue decreased from 3.144 million to 3.049 million, and gross operating result (EBITDA) also fell from 336 million to 311 million first quarter of 2024.