Two of the largest North American automotive parts suppliers saw higher revenues in the fourth quarter even as softer vehicle production and persistent industry headwinds weighed on their profit margins.
Earlier this month, both Magna International and LKQ Corporation both reporting mixed results heading into an uncertain 2026.
Magna, the Aurora, Ont.-based supplier, recorded fourth-quarter sales of US$10.8 billion, a 2% increase year over year. LKQ, which supplies recycled and aftermarket auto parts across North America and Europe, reported fourth-quarter revenue of US$3.3 billion, also up 2.7% year over year, though adjusted earnings at both companies came under pressure.
Swamy Kotagiri (pictured), Magna's chief executive officer, said the company closed the year with strong operational performance.
"We closed 2025 with a strong fourth quarter, successfully navigating another dynamic year in our industry," Kotagiri said in the release. "Our disciplined execution and commitment to operational excellence enabled us to deliver financial results that were in line with, or exceeded, our February 2025 outlook across all key metrics."
Magna's outlook for 2026 includes projected sales between US$41.9 billion and US$43.5 billion.
Magna's share price has fluctuated in recent weeks, trading near US$68 in mid-February before declining to roughly US$60 in early March, reflecting broader volatility in automotive supplier stocks.
The company's founder, Frank Stronach, is currently on trial in Toronto on sexual assault charges involving seven complainants, with allegations spanning incidents between 1977 and 1990. Stronach, who left Magna's board in 2012 and has had no ties to the company since, has pleaded not guilty.
Justin Jude, president and chief executive officer of LKQ, said the company generated strong cash flow during the year despite industry headwinds.
"Our team relentlessly focused on what we could control, resulting in significant free cash flow generation despite sector headwinds across our global enterprise," Jude said in the earnings release.
Jude said LKQ's North American operations expanded their position in the market even as demand softened.
"Our North America business gained market share in a soft demand environment through pricing discipline and continued expansion of our MSO relationships," he said.
The release also outlines restructuring efforts in Europe.
"Despite the headwinds in Europe, we further integrated and simplified our operations to support sustained margin improvement," Jude said.
LKQ's outlook for 2026 includes adjusted earnings per share guidance between US$2.90 and US$3.20, reflecting current market conditions and expected tariff impacts.
