American Axle’s third-quarter earnings fell 36 percent

Article by Christian Andrei, on October 31, 2011

Third-quarter earnings of American Axle & Manufacturing Holdings Inc. fell by 36%, mostly due to costs linked to plant closures. It recorded a net income of $24.8 million in the third quarter, compared to $38.8 million the previous year. In the latest period, the company incurred $11.9 million in charges over the planned closure of two U.S. manufacturing facilities.

The company had previously said that it will shut down plants in Michigan and New York after it failed to enter competitive labor contracts with the UAW. The special charges in this quarter included a $1.6 million asset impairment posted by its e-AAM joint venture associated with a long-term supply contract with Saab Automobile AB.

In the latest period, its revenue rose by 5% to $647.6 million. American Axle, which manufactures driveline systems, chassis systems and forged components for trucks, buses and cars, has experienced a rebound after having faced a string of financial losses that were resolved in 2009.

The demand in the U.S. for light vehicles grew 10% through September. General Motors Co., a major customer and former parent, has recorded a 16% increase in sales this year for its light vehicles in the U.S.

American Axle has also been diversifying and has gone into businesses outside of the light truck market. The company said that about two-thirds of its new business backlog that will launch from 2012 through 2014 is for passenger car, crossover vehicle and commercial vehicle programs.

In a statement, CEO Richard E. Dauch said that after maintaining a strong profit performance in the last two years, it is now able to accelerate the investment in advanced product, process and systems technology required to expand and diversify its customer base, product portfolio and served markets. [source: BusinessWeek]

Topics: american axle

If you liked the article, share on:


Login or Create new account to add a comment!


Honda has unveiled the fifth generation of its hot-selling SUV – the 2017 Honda CR-V. The latest iteration of the CR-V should help it maintain its benchmark status in the...
by - October 21, 2016
Many are already expecting BMW to launch an ultra luxurious SUV that will serve at its new flagship by late 2018. Larger than the X5 and X6, the new X7...
by - October 21, 2016
Most of you may have heard or already have one of those autonomous home appliances doing the house chores. Thus, it’s not anymore unusual to see a car going places...
by - October 20, 2016
Mini has just provided the world with a preview of its first hybrid model that employs petrol-electric power to propel its wheels. Derived from the second generation of the Mini...
by - October 20, 2016
For the second time in three years, German driver Marco Wittmann of BMW Team RMG reached the summit in the DTM Drivers’ Championship. Even though Wittmann only secured a fourth...
by - October 20, 2016