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The company’s fall in profit comes amid ongoing chip shortages and rising raw materials costs that have battered big auto parts and technology suppliers during 2022.
This also comes at a time when auto suppliers are vying to meet the requirements of automakers shifting to electric vehicles, with Magna in December agreeing to buy Veoneer (NYSE:VNE) Active Safety for $1.53 billion to bolster its portfolio of self-driving technology.
Magna said on Friday “operating inefficiencies” at a facility in Europe were a drag on its fourth-quarter results. Auto suppliers struggled last year due to a volatile schedule at the continent’s automakers, in part due to an energy crisis.
Magna, which makes parts such as body structures, chassis and powertrain for automakers including Ford Motor (NYSE:F) and Volkswagen (ETR:VOWG_p), warned last month its profits would not meet its earlier expectations because of a number of issues including higher-than-expected warranty costs, lower sales and provisions for bills that customers might not pay.
The Aurora, Ontario-based company reported adjusted net income of 91 cents per share, missing analysts’ expectations of $1.06, according to Refinitiv.
Revenue increased 5% to $9.57 billion for the quarter, compared with analysts’ expectations of $9.51 billion.
