FRANKFURT - Sales and profits for German suppliers are on the rise in 1999.
Suppliers benefited from a 6.4 percent rise in German car production in the first six months of 1999 to 2.75 million units. Expanding German output abroad also helped.
Growth was even higher in value terms as production of cars over 3.0-liters grew by 12 percent in Germany, while small-car production fell 16 percent.
'Strong growth was seen by suppliers of some optional equipment, as carmakers have been raising standard equipment levels to offset weaker pricing,' said analyst Sarah MacKenzie of Auto Business Ltd. in the UK. 'Module and systems suppliers also outpaced the growth in car volumes as outsourcing to competent suppliers continues to accelerate.'
Here is a summary of first-half German supplier financial results:
WET Automotive Systems AG
The seat-heater manufacturer exceeded all expectations in the first six months. Sales soared 46 percent to DM188 million (euro 95.2 million). WET's profits increased by 43 percent to over DM9 million.
Leonische Drahtwerke AG
Sales and pretax profits at the wiring and cable group increased by more than 20 percent to DM584 million and DM35.3 million respectively in the first half of 1999. Growth came from both increased sales and consolidation of new subsidiaries in France, Belgium, Brazil and Germany.
Revenues increased by 20 percent to DM570 million in the first half for the car locking systems supplier. However, ordinary profits fell by DM3.2 million to DM 57.9 million, because important car launches were postponed in the USA. But Kiefert expects significant improvement in its US business in the second half of 1999. For the full year Kiekert expects group sales of around DM1.2 billion, an increase of 17 percent over 1998.
Europe's leading commercial vehicle truck brake supplier reported a sharp hike in sales in the first half of 1999. Revenue was up by 28 percent to DM1.27 billion. The company also said that is order book had reached a record level of DM1.6 billion. Knorr-Bremse expects full year sales of DM2.4 billion.
Sachsenring Automobiltechnik AG
The publicly-quoted east German component supplier showed strong growth in the first half as sales increased by 18 percent to DM 213 million.
Group net profits rose to DM15.9 million from DM7 million for the first half of 1998. This represented a return on sales of 7.5 percent. Earnings before interest and tax rose by 14 percent to DM25.6 million and pre-tax profit increased by DM3.6 million to DM19.3 million.
The maker of hinges attributed strong first-half performance to global expansion. The group, which was listed in March 1999, increased sales by 12.3 percent to DM973.6 million. Revenue from its fifteen production facilities outside Germany grew by 26.5 percent to DM466.4 million, while its domestic revenue rose by only 1.8 percent to DM507.2 million.
The aluminum wheel manufacturer continued its turn-around in the first half of 1999, reporting an 11 percent increase in revenue to DM117.2 million compared to the same period in 1998. Of the total DM70.4 million was in Germany and DM46.8 million was from abroad. Pre-tax profits grew to DM9.1 million from DM6.1 million. BBS said that its results were boosted by its efforts to cut costs and its improved product range.
Mannesmann VDO AG
Revenue at the cockpit and instrumentation supplier climbed by 9 percent to DM3.5 billion in the firs thalf of 1999. Adjusted for the consolidation of the new acquisitions Car Audio Electronics (China), Lucas Kienzle (Great Britain) and VDO Halla (Korea), sales were up by 5 percent. Mannesmann VDO's cockpit systems and fuel systems units showed the strongest growth, rising by 26 percent and 15 percent respectively.
The Hamburg-based supplier of rubber-metal components reported a 4.4 percent rise in sales in the first half of 1999, to DM 863.9 million. Sales in the Vibracoustic division climbed by 7.3 percent to DM421.3 million. Pre-tax profits at Phoenix grew by 7.4 percent to DM29.7 million.
Mannesmann Sachs AG
Sales at the clutch and shock absorber manufacturer fell by 2 percent to DM2.13 billion. Growth in the company's torque converter business (up 35 percent) and in Rubber Metal Parts (up 5 percent) was offset by a 16 percent drop in clutch sales and a 6 percent decline in shock absorber sales.