Forvia, the world’s seventh-largest car parts supplier by revenue, has announced new agreements with Chinese automakers BYD and Xiaomi as part of its efforts to offset declining demand from domestic manufacturers. Chinese sales account for a quarter of Forviaâs total revenue, and these contracts are seen as vital to stabilizing its performance.
In a statement accompanying its third-quarter sales report, Forvia revealed that it had been selected to supply parts for BYDâs second European factory, located in Turkey. The company also confirmed new deals with Chery and Li Auto, further expanding its presence in the Chinese market. Analyst Stephen Reitman from Bernstein noted, “Forviaâs ability to secure business with BYD outside China is reassuring as it helps to mitigate fears that Chinese automakers will not use international suppliers in their European expansion.”
Forvia also secured its first contract with Xiaomi, a leading telecom company entering the electric vehicle (EV) sector. “It’s very good that we are able to extend our reach with Chinese manufacturers, including the latest entrants like Xiaomi,” said Forviaâs finance chief Olivier Durand.
Despite the positive developments, Forvia reported a 2.6% year-on-year decrease in third-quarter sales, totaling âŹ6.53 billion, with Chinese sales falling by 13.5%. The company aims for a return to outperformance in China by 2025, but Alphavalue analyst Adrien Brasey noted that this target “will strongly depend on Forvia’s ability to increase its exposure to Chinese carmakers.”
Source: Reuters
