The rising complexity of automotive electronics delivered Visteon Corp. a file gross sales 12 months, however the scarcity of a selected kind of semiconductor has prevented the automotive provider from capitalizing on demand.
The provider of cockpit electronics, with roots as a unit of Ford Motor Co., completed the 12 months with $1 billion in gross sales for the fourth quarter, up 35 % from the 12 months prior, whereas internet earnings was stage with final 12 months at $35 million.
For full-year 2022, Visteon’s internet earnings practically tripled from the 12 months earlier than to $130 million, on $3.8 billion in income, up 36 % 12 months over 12 months and besting its earlier gross sales file set in 2017.
A main driver of Visteon’s progress was its digital clusters section, which elevated 40 % 12 months over 12 months with key launches in North America. The section is anchored by more and more refined infotainment and dashboard shows.
Of the 45 new product launches, 17 had been digital clusters, together with within the Stellantis NV cross automotive line, in addition to Ford Tremendous Obligation vehicles, transit business automobiles and SUVs. Ford stays Visteon’s largest buyer, making up 22 % of gross sales.
“Since 2015, we’ve positioned our product portfolio from primarily analog clusters and AM/FM radios to business main digital clusters, centralized area controllers, superior shows and sensible battery administration programs,” CFO Jerome Rouquet mentioned on a name with traders. “These initiatives have enabled us to profit from the cockpit tendencies whereas outperforming in a difficult surroundings.”
Visteon’s progress, nonetheless, has been stunted by a lingering microchip scarcity. Whereas the availability bottleneck has improved considerably, the corporate is experiencing one other semiconductor headache — a scarcity of microcontrollers, which management every thing from air conditioners to headlights in new automobiles.
“They lower throughout all merchandise. Each product that we do requires these energy chips to drive the remainder of the circuitry,” CEO Sachin Lawande advised traders. “As we begin right here in 2023, we see our scenario with respect to analog chips enhance, however there are rising shortages within the areas of microcontrollers that’s extra pushed by the dearth of wafer provide from foundries to semiconductor suppliers.”
Automotive suppliers from Lear Corp. to Aptiv plc have pointed to the identical downside as upcoming headwinds.
Visteon (NASDAQ: VC), whose inventory worth ticked up 5 % to $167.11 per share as of Thursday afternoon, anticipates gross sales of $4.05 billion, engaged on the belief that international automotive manufacturing can be nearly flat at 84 million models.
On the microchips downside, relatively than await the availability chain to catch up, Visteon is implementing workarounds for the scarcity by re-engineering some merchandise.
“We’re persevering with to revamp a few of our merchandise to provide us extra flexibility in order that we’d be able to handle extra demand as we anticipate,” Lawande mentioned.
Visteon ranks No. 66 on Automotive Information‘ 2022 listing of the highest 100 international suppliers with worldwide gross sales to automakers of $2.73 billion in 2021.