Canadian auto parts maker Magna International on Thursday reported a 136% rise in quarterly profit and raised its full-year revenue outlook, as strong demand for vehicles encouraged its customers to order more body structures, chassis and powertrains.
While a strong pent-up demand and preference for private vehicles during the COVID-19 crisis lifted sales at auto suppliers, a shortage of semiconductor chips has caused automakers to curtail production and forecast billions in losses.
Analysts expect a peak headwind to production due to the chip crunch in the second quarter. Semiconductors are used extensively in cars, for everything from engine performance monitoring to parking sensors.
Magna’s revenue for the year is now expected to be between $40.2 billion and $41.8 billion, up from a previous forecast of $40.0 billion to $41.6 billion.
Global light vehicle production was up 18% in the first quarter driven by an 87% increase in China, the company said in a statement.
Net income attributable to Magna rose to $615 million, or $2.03 per share, in the first quarter ended March 31, from $261 million, or 86 cents per share, a year earlier.
Total sales rose to $10.18 billion from $8.66 billion.