Valeo plunges 10% as company trims sales forecast amid disappointing EV demand 📉

Shares of French auto parts producer Valeo (FR.FR) drops 10% as the company trimmed 2024 revenue forecast. Valeo now expects €21.3 billion, vs €22 billion previously. The revision follows a challenging Q3, marked by lower demand; sales dropped by 5% YoY to €4.97 billion. What's important, today overall sentiments across the automotive sector are weak, after Mercedes-Benz quarterly report.

• Valeo's original equipment sales in Q3 fell by 2% on a like-for-like basis. In Europe and Africa, original equipment sales outpaced regional automotive production by 6 percentage points, driven by powertrain products, and driver-assistance systems as well as display technology segments. 
• But in the North America market, sales lagged, trailing production by 1 pp. even despite new electrification deals; also China showed a huge drop, underperforming production by 9 pp. 
• Valeo cited the worsening economic environment and 'significant uncertainty surrounding automotive production volumes' and declared new 2025 guidance when the company will publish final 2024 results.

Source: xStation5