Canadian auto supply giant Magna International has withdrawn its 2020 forecast amid the novel coronavirus pandemic, but it’s reassuring investors that it has $1 billion in cash and $3 billion in readily available credit.
“A number of our OEM customers, particularly in North America and Europe, have initiated production downtime or have reduced production rates,” the company said in a statement Thursday evening. “It is uncertain whether OEMs will extend production downtime or further lower production rates as circumstances evolve.”
Ford Motor Co., FCA, Toyota Motor Corp. and Honda Motor Co., on Thursday updated plans to resume North American light-vehicle output. Their restart times vary anywhere from some plants resuming operation April 6 to others not coming online until April 20.
“Many of our facilities have reduced or suspended operations for reasons related to the COVID-19 pandemic, including as a result of government-ordered restrictions,” Magna said.
Michigan’s stay-at-home order, for example, ends April 13. In Ontario, Premier Doug Ford ordered all non-essential businesses to close for 14 days. They can reopen April 8.
Magna’s China facilities are just now coming back online.
“Following an extended period of production downtime in February, our operations in China continue to ramp up along with the overall local industry,” the supplier said. “While business activity continues to increase, it remains below the production levels anticipated earlier this year.”
Magna said its investors “should take comfort from the fact that we have liquidity of approximately $4 billion including approximately $1 billion in cash and $3 billion in available, committed credit lines at February 29, 2020.”
In the meantime, Magna said it is working to help source and produce critically-needed supplies and equipment for the health care sector.
“Our global purchasing organization has been successful in securing significant quantities of masks for local hospitals and health care authorities.”