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Magna International Warns Rising Global Protectionism Could Have ‘material’ Impact on Profitability


(Reuters)

Magna International Inc., Canada’s biggest car parts maker, warned that the rise in global protectionism could have a “material” impact on results and that any U.S. border tax would likely be negative for the auto sector.

The company warned that the election of protectionist governments could lead to the withdrawal of some countries from, or renegotiation of, multilateral trade, economic or currency regimes such as the European Union, North American Free Trade Agreement and Trans-Pacific Partnership.

“The automobile industry is a highly globalized industry which is currently dependent on open borders and the free movement of goods,” Magna said in its earnings statement Friday. “The continued growth of protectionist sentiments” could have a “material adverse effect on our operations, profitability or results of operations.” Click here to read more.