Aptiv, BorgWarner flag hit from Nexperia chip crisis, Novelis fire

By Nathan Gomes

(Reuters) -Auto parts makers Aptiv and BorgWarner on Thursday warned of production snarls from a supply crunch related to Dutch firm Nexperia and a fire at a critical aluminum supplier.

The news comes after Beijing banned exports of Nexperia's Chinese products after the Dutch government seized control of the chipmaker, citing security concerns over its Chinese parent, Wingtech.

BorgWarner said it expected some shutdowns related to the incident, especially in Europe and China.

"It is a political issue between the Dutch government and China," Aptiv CFO Varun Laroyia said on a post-earnings call.

The disruptions come after the industry had just found its footing following years of semiconductor shortages caused during the COVID-19 pandemic.

Additionally, companies are also navigating headwinds related to Trump's broad range of tariffs and sluggish electric vehicle demand.

A September fire at Novelis' Oswego, plant, a key aluminum supplier to multiple automakers, has impacted some North American companies like Ford and Stellantis.

Aptiv, which counts Ford and Stellantis as customers, said it saw some volume impact associated with the facility. BorgWarner said it expects an impact of between $50 million and $100 million in the fourth quarter related to the fire.

Shares of Aptiv fell about 2%, while BorgWarner rose nearly 4% after it topped analysts' estimates for third-quarter profit.

Aptiv, however, raised its annual adjusted net income per share forecast to be between $7.55 and $7.85, from $7.30 to $7.60, banking on sustained demand for electrical and software systems.

Its quarterly net sales rose 7.4% to $5.21 billion, topping estimates of $5.09 billion.

On an adjusted basis, it earned $2.17 per share for the quarter through September, compared with $1.83 a year earlier.

(Reporting by Nathan Gomes in Bengaluru; Editing by Anil D'Silva and Maju Samuel)

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