Global automotive demand promises continued growth for GKN
THE continued expansion of the global automotive sector is expected to sustain growth for Birmingham-based GKN Driveline.
The company has forecast that global light vehicle production should grow around 2% this year with increases in Asia and North America but down in Europe.
For 2013 the major markets where production is expected to grow fastest include China (9%), India (8%), Brazil (3%) and North America (3%). Production in Europe is expected to contract by 3% and to decline by 12% in Japan.
The operation’s record performance for 2012 – illustrated in the GKN group’s full-year results today – owed much to international opportunities.
During 2012 sales rose 16% to £3,236m (2011: £2,795m), while trading profit was up 21% to £235m.
The division’s sales, which are stretched across various diverse geographies and platforms, outperformed the market.
In North America, Europe and China recent market share gains, a stronger position in premium vehicles, demand for which continued to be good, and GKN Driveline’s broadening product mix, particularly with all-wheel drive (AWD) systems all contributed to the healthy results.
In Japan, GKN Driveline was affected less than the market generally by the earthquake in 2011 and therefore did not benefit from the significant bounce back in production volumes in 2012. Furthermore, many of GKN Driveline’s sales in Japan are AWD products for cars that are exported, including many to China where a political dispute affected sales of Japanese cars in that country.
Overall, global production volumes increased 6.1% in 2012 to 81.5m vehicles (2011: 76.8m). Europe’s production declined 5% to 19.2m but impressive growth in North America (17.6%) and Japan (19%) more than offset this.
GKN said demand for premium vehicles had continued to grow with production in Europe benefitting from continued strength in export demand, while in North America the recovery continued. Japanese production rebounded from the impact of the 2011 earthquake and sales were supported by government incentives.
However, demand for smaller vehicles in Europe continued to decline, particularly in the weaker economies of southern Europe.
New business wins continued across GKN Driveline’s product groups, including the CVJ Systems business, significant customer wins in AWD systems, strong gains in electronic differential lockers (which is part of TransAxle Solutions) and eAxle wins for hybrid vehicles (which is part of eDrive).
Driveline’s expansion plans also continued with the addition of its third precision forge in Celaya, Mexico with an annual capacity of more than 15m forgings, the expansion of two of its plant in China and the opening of a new plant in Pune, India, where Tata Motors’ owned Jaguar Land Rover is assembling Freelander kits.
A new innovative manufacturing flow line was also opened at Trier, Germany which automates the production of precision forgings. This process increases safety and efficiency and reduces inventory and energy consumption.
Driveline develops, builds and supplies an extensive range of automotive driveline products and systems for use in the smallest ultra low-cost car to the most sophisticated premium vehicle demanding the most complex driving dynamics.
