Pandemic's Impact on Auto Industry ‘Worst Seen in Our History,’ Says Autoliv CEO
The auto industry “slump,” triggered by the shutdown of car plants and dealerships from the COVID-19 pandemic “is the worst seen in our history,” said Autoliv CEO Mikael Bratt on a Q2 investor call Friday. The company supplies vehicle safety…
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systems to major car manufacturers in 27 countries. April vehicle production came to a virtual standstill in Europe and North America, said Bratt. That “coupled with the volatile restart” and ramp-up in May and June “had a drastic effect on our profitability despite forceful cost reductions,” including 25% personnel cost savings through layoffs and furloughs, he said. Autoliv swung to a $171 million Q2 operating loss from a year-earlier $183 million profit. “It is essential to balance the cost reduction response against the need for capacity to manage the recovery that has started,” said Bratt. North American vehicle production “resumed in mid-May, about two weeks later than in Europe,” he said. “However, the ramp-up has been faster and less volatile.”