American Axel and Manufacturing Holdings (AXL) posted a loss of $1.33 a share, a good bit worse than the 95-cent hit Wall Street had predicted.
So far today, its shares are off almost 18 percent to $5.41 midday, and they've slumped more than 71 percent so far this year.
A strike hurt the parts supplier, but the real damage is coming from its biggest customers. Automakers are sinking under the weight of soaring gasoline prices, problems in their credit arms, and a slow economy that continues to batter auto sales. Chrysler said Friday it will stop leasing vehicles to consumers on August 1. Even industry leader Toyota said today it would lower sales targets by 3.6 percent this year as demand for trucks and SUVs continues to plummet.
CEO Dick Dauch called the strike, the economy, and the ailing auto sector a "brutal combination." Production volume of parts the Detroit-based company made for General Motors and Chrysler fell 51 percent from a year ago, the company said.
A deal on wages, including a big 40 percent cut in hourly wages, is part of what analysts say is a reasonable plan to get back on track, but it's not clear that the company won't be beaten down more by the ongoing drop in demand for new cars.
kakai of @ Jul 28, 2008 20:43:26 PM