Magna International, one of the world’s largest automotive suppliers expects global sales to hit as much as $45.5 billion in 2023, officials told investors this week.
The company said it expects sales to grow to a range of $43 billion to $45.5 billion in 2023, up from $32.6 billion in 2020. Officials expect global light-vehicle production to grow 6% on average per year from 2020 through 2023, while the company’s annual sales will grow 10-12% on average, per year over that time frame, the annual report indicated.
Innovation leads the way
This growth is being led, in part, by several new products developed by Magna. One of those are EV battery enclosures that contribute to the structure of the vehicle, protect high-voltage batteries and will debut on the new GMC Hummer EV and Ford F-150.
Another technology developed by Magna, Clearview, a combination of camera and mirror technology that provides an enhanced field of view. It will be available on multiple vehicle models for the global automotive market.
Freeform is a surface seating trim that improves seat comfort with contoured surfaces which has been sourced with two global automakers, Magna added.
Strong balance sheet aids growth
Magna also said in February net income from the fourth quarter of 2020 increased 68% from a year earlier due in part to better-than-anticipated vehicle production.
“Our balance sheet remains strong,” said Magna CEO Swamy Kotagiri in a letter to shareholders in the annual report.
“Last year we invested approximately $600 million in areas of engineering aligned with megatrends, including electrification, autonomy and new mobility. We will continue our disciplined investment approach to drive growth and create long term shareholder value.
“As one of the world’s largest and most advanced technology suppliers in the mobility space, we continue to be an indispensable partner for established automakers and new entrants alike. While Magna’s current product portfolio is well positioned for the car of the future, we are continuing to expand our offerings, capabilities and evolving business models.”
The annual report also noted that Magna had launched a new joint venture with South Korea-based LG Electronics that blends Magna’s strength in electric powertrain systems and automotive manufacturing with LG’s expertise in component development for e-motors and inverters, accelerating both companies’ growth in the electric powertrain market.
In addition, Magna is supplying electric carmaker Fisker with an EV platform, electrical/electronic architecture, vehicle engineering and manufacturing and the complete ADAS system for the Fisker Ocean SUV, demonstrating Magna’s unique systems level approach.
“Additionally, we continued to win significant business throughout the year, despite pandemic constraints, driven by our leading technology,” the company noted. “These wins reflect our continued investments that drive innovative solutions for our customers. In fact, over 90% of our 2023 sales are already booked.”
New venture with Israeli company
Magna also entered into a new agreement with REE Automotive Ltd. Tel Aviv-based REE is a self-described electric mobility company, marketing Modular Electric Vehicles, or MEVs.
The collaboration will explore the combination of REE’s technology with Magna’s vehicle systems integration expertise and manufacturing capabilities, to develop MEVs for commercial customers to customize vehicles based on their specifications and branding, while accelerating time to market.
“We are thrilled to reach a collaboration agreement with Magna, which should help put us on the fast track to support a broad range of electric vehicles (EVs),” said Daniel Barel, REE Co-Founder and CEO, in a statement.
“We see a growing demand for highly modular EVs from leading tech companies and new electric mobility players who have set their sights on entering the EV realm and building a brand in automotive. REE and Magna working together under the ‘Powered by REE’ approach can help bring their vision to life.”