Magna International Inc.’s MG-T +18.94%increase share price rose by 18 per cent on Friday after the Aurora, Ont., auto parts maker forecast steady sales for 2026, buoyed by new assembly work for Chinese electric carmakers.
Magna finance chief Phil Fracassa said global auto production is expected to be flat this year, but new contracts to make electric cars in Europe for China’s Xpeng and GAC will help lift the company’s sales.
Magna began assembling the EVs for Xpeng and GAC late last year at its Magna Steyr plant in Graz, Austria, which has produced more than four million vehicles for Mercedes, BMW and other brands. The Chinese companies are increasingly selling EVs in Europe and turned to Magna to produce domestic supplies.
“Looking ahead, this should continue to represent a growth opportunity for our complete vehicles business,” Mr. Fracassa said.
In a conference call with analysts on Friday, Mr. Fracassa said Magna is forecasting sales this year of between US$41.9-billion and US$43.5-billion, or nearly flat to a 3.5-per-cent increase over 2025.
Magna, which has plants around the world, will also benefit from increased vehicle production in Europe and a weaker U.S. dollar, Mr. Fracassa said on the call, held before markets opened to discuss fourth-quarter and full-year results for 2025. Those factors should outweigh an expected slip in production in China and North America, he said, as Magna ends production of the Toyota Supra and BMW Z4 in Graz.
For 2026, Magna forecasts adjusted profit per share will be between US$6.25 and US$7.25. This is higher than analysts’ estimates of US$5.99, according to LSEG, a financial data company.
Stock analyst Michael Ward of Citigroup said the guidance points to an earnings before interest, taxes and depreciation margin with a midpoint of 10 per cent, Magna’s best since 2021.
For 2025, Magna said its profit fell by 20 per cent to US$829-million or US$2.93 a share, compared with US$1-billion (US$3.52) in 2024. Revenue fell by 2 per cent to US$42-billion, compared with 2024.
For the fourth quarter of 2025, Magna lost US$1-million, down from a profit of US$203-million in the same period a year earlier. Revenue rose by 2 per cent to $10.8-bilion, from the year-ago quarter.
Magna and other automotive companies have been hit by U.S. President Donald Trump’s tariffs in the past year, causing manufacturers to absorb billions in costs. At the same time, carmakers in North America have taken billions in writeoffs for EV investments as demand has slowed amid U.S. rollbacks of purchase incentives and other regulations.
Swamy Kotagiri, Magna’s chief executive officer, said the company has offset the impact of almost all the tariffs, recovering them from customers.
In the European Union, battery-electric and hybrid-electric cars captured 17 per cent and 14 per cent of the market, respectively, according to the European Automobile Manufacturers’ Association.
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