Plymouth, Michigan — Adient, which makes automotive seating and interior components, saw third 2017 quarter sales fall 8% to $4 bn from $4.4 bn in the equivalent 2016 quarter but earnings were up.
EBIT margin of 7.4% on an as reported basis was up compared with 3.3% in 2016. Earnings before interest and taxation were $296m compared with $145 m in Q3 2016.
The firm put this increase in earnings down to lower sales, general and administrative costs after the separation from Johnson Controls, lower corporate expenses and improved operational performance.
Gross bookings of new work continue to be stronger than in 2016 which totalled $5.3 bn.
Adient is diversifying into luxury brands and defending its position with existing customers, said Mark Oswald, executive director, global investor relations. He added that China was likely to be an increasingly large and strong part of his firm’s business. This because, he said, the country’s auto industry is growing and the volume of seating and automotive interiors is likely to keep increasing.
The firm’s strategy is ‘to have the broadest and most complete range of seating products, market leadership in the US, Europe and China and to support all major automakers.’ For example, its products are found in the VW Tiguan (Mexico), Chevrolet Traverse (US) , Honda CRV (Malaysia), Audi A-8 (Romania), Seat Ibiza and VW Polo (Spain), Volvo XC-60 (Sweden), BMW 5 Series estate (Czech) and Toyota Camry (US).
Adient said that it faces ‘manageable headwinds from commodity prices’ for the remainder of 2017. Bruce McDonald, CEO said his firm was ‘focused on executing its plan, to drive another quarter of earning growth, margin expansion and cash generation.’