Magna Steyr, despite Fisker woes, remains bullish on EVs

GRAZ, Austria — Magna Steyr remains bullish on electrification, despite slowing consumer demand for electric vehicles and regardless of Fisker’s decision to cease production at the contract manufacturer’s facility here.

“The trend for electrification will continue,” Magna Steyr President Roland Prettner said at a press event this month. “In fact, we are seeing an increase in EV demand, not a decline. … The question is how steep that [growth] curve will be.”

First-quarter sales of electric vehicles in Europe rose 4.1 percent to 450,498. In Germany and Sweden, however, EV sales fell 14 percent and 19 percent, respectively, during the quarter, according to figures from market researcher Dataforce.

$400 million decrease

Earlier this month Fisker’s unit in Austria filed for reorganization and court protection from creditors after deciding to stop production at the Graz plant.

Magna Steyr’s parent, Magna International, said this month it was facing lower-than-projected sales and earnings after its business with the U.S. EV maker was idled.

The company, which was under contract to build Fisker’s Ocean electric crossover, is assuming no further production and a resulting $400 million revenue decrease for the year.

Magna Steyr also announced that it would dismiss 500 employees at the Graz facility because of the production stoppage of the Ocean as well as the BMW 5 Series and Jaguar E-Pace and I-Pace.

EVs here to stay

Despite the volatility in the EV sector after several years of rapid growth, Prettner said the future will undoubtedly be electric. “That will not change,” he said.

He added, however, that hybrid powertrains will be available for longer than expected. His view is shared by German supplier ZF Friedrichshafen. “We are seeing the life cycles of these cars [hybrid and plug-in hybrids] being significantly extended," ZF board member Peter Holdmann told Automotive News Europe.

150,000-vehicle capacity

Magna Steyr has capacity to make up to 150,000 vehicles on its three assembly lines in Graz. Ideally, production volume at Graz would reach at least 25,000 vehicles a year, Prettner said. With 50,000 so far, the Mercedes G-Class is the highest-volume vehicle to come out of the plant.

To date, Magna has manufactured more than 4 million vehicles, including 34 models from 11 automakers. It offers three business models, namely engineering; engineering and manufacturing; and manufacturing.

For example, it provided engineering help to Ineos Automotive for the Grenadier off-roader and the Quartermaster pickup. In February the vehicle-making arm of the British petrochemical conglomerate Ineos Group said Magna Steyr will produce the automaker’s forthcoming Fusilier, which will be offered with electric and range-extender powertrains.

“What makes us unique and important to our customer is the fast time to market,” Prettner said, adding that the company can move quickly because it has expertise with a wide variety of powertrains. “All we need is a vision from our customer. Everything else we can then do.”