DETROIT (Reuters) -- The turmoil in Europe's auto industry may present an opportunity for American Axle and Manufacturing Holdings Inc. to acquire distressed assets, new CEO David Dauch said in an interview on Wednesday.
Any potential purchase would likely be a bolt-on acquisition that builds on the U.S. auto parts supplier's expertise in advanced vehicle technology. The company makes axles and other components related to driveline and drivetrain systems.
"If there's a way to expand our presence in Europe that strengthens our brand, we'll do it," Dauch said after an event held by the Detroit Economic Club.
Dauch succeeded his father, Richard Dauch, as CEO on Sept. 1. Richard Dauch, who remains chairman of American Axle, spoke at Wednesday's event to promote his new book, "American Drive."
American Axle's top priorities are to pay down its $1.2 billion in debt and diversify its customer base. During the first six months of the year, General Motors Co. accounted for about 74 percent of the supplier's sales.
At the same time, the company is developing products that can help vehicles improve performance and fuel economy, areas in which European suppliers are typically strong, Dauch said.
Some of these assets may come up for sale as Europe's debt crisis saps demand and automakers weigh plans to cut capacity in the region. Richard Dauch said Europe's auto sector is in "deep, deep trouble."
"The restructuring hasn't even approached 20 percent of what has to be done in Europe," he told reporters. "As far as I'm concerned, they're not doing enough. They need to do a whole lot more faster, quicker, deeper, wider."
Earlier this year, American Axle paid $4 million to buy the remaining stake in its joint venture with Saab Automobile, e-AAM Driveline Systems AB, to design electric all-wheel drive systems that boost fuel efficiency and reduce emissions.
This represents a "perfect example" of the kinds of acquisitions that American Axle might seek in the future, said Christopher Son, head of investor relations.
The U.S. auto industry is looking for ways to wring out more miles per gallon as U.S. fuel economy standards tighten.
By 2025, automakers must show a corporate average fuel economy of 54.5 miles per gallon. This translates to 36 mpg or higher in real world driving. Vehicles built for the 2011 model year got an average of 22.8 mpg, U.S. government data shows.