Autoliv hikes sales forecast as tariff costs shift to automakers

Time of India

3 days ago

Swedish auto supplier Autoliv raised its full-year sales guidance on Friday and said it had passed on most of its tariff-related costs in the second quarter, as it reported a profit for the period that matched expectations. The world's largest maker of
airbags and seat belts
is mostly affected by tariffs between the United States and Mexico and Canada. U.S. President Donald Trump has threatened to raise tariffs on imports from both of these countries to 30 per cent and 35 per cent, respectively, from August.
U.S. tariffs
on foreign auto imports are expected to raise car prices by thousands of dollars, reducing demand and hurting job growth, rattling an industry already struggling with a difficult transition to electric vehicles.
"We recovered around 80 per cent of
tariff costs
in the second quarter, and we expect to recover most of what remains later in the year,"
CEO Mikael Bratt
said, adding that the company remained confident it could continue to successfully receive compensation from its customers for tariffs.
"There's no logic whatsoever why the suppliers or the value chain should absorb this," he added.
Autoliv - customers of which include most of the largest
automakers
such as Volkswagen, Stellantis and Toyota - said it now sees
organic sales growth
this year of around 3 per cent. Its previous forecast, last reiterated in April, was for 2 per cent.
Analysts at Jefferies said in a note to clients that the results again demonstrated Autoliv's resilience in a quarter with significant tariff volatility.
Adjusted operating profit grew in line with expectations to $251 million from a year-earlier $221 million, with organic sales growth of 3 per cent.
Its adjusted operating margin was 9.1 per cent, a near industry-leading margin, according to analysts at Citi.