Earnings call transcript Q1 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, everyone. My name is Jamie, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the American Axle & Manufacturing First Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, today's call is being recorded.

And this time, I'd like to turn the floor over to Mr. Investor of Head Lim, Relations. David Mr. Please go ahead, Lim.

David Lim

to Thank is who call. like first you good morning. and welcome joining earnings everyone quarter I'd us AAM’s on

this of first Earlier released announcement. earnings quarter we morning, XXXX our

website, this access Newswire Investor of the on You www.aam.com can through announcement and Relations the page our services. PR

code for X-XXX-XXX-XXXX, find this This listen on to XXXXXXX. replay conference of the replay as Investor available You can XX. this website To also page you well. dial can call, access supplemental slides be May will call of our replay a through

that begin, matters contain we operations of I'd future subject which Before like forward-looking materially quantified differ to predicted to and in may to cause remind those activities everyone and call and discussed. be and may uncertainties, cannot the results this risks from statements discussed comments or which

refer For our additional to Exchange filings with that we Commission. ask Securities and information, you the

may Information reconciliation measures certain available this to non-GAAP call, during on these our non-GAAP measures. of well we as financial measures to website. financial information Also, GAAP non-GAAP is refer as these regarding a

me let CEO, AAM’s Chairman that, Dauch. With things over David turn to and

David Dauch

quarter AAM’s morning, you, today XXXX. discuss Thank for the financial of first joining results good Thanks to for us David, everyone. and

first Joining financial AAM’s To and our Chief the performance. is begin review me Financial my Chris the quarter today Executive on of highlights Officer. call May, Vice President comments, I'll

of the to you may After developments including product combination interest strong technology we'll density, any I our questions driving exciting is Next, open quarter, The Chris up leadership, is in business. significant and accelerating. is technology of our including call with expertise, some MVH and The will results, efficiency, touch have. of covers clear details on the electrification financial optimization, portfolio. the that all our our momentum power our news mass in

AAM customers $X.XX be So production volatility. of downtime sales continues largest our AAM’s and billion. let's first quarter at were XXXX by to begin. impacted

quarters. that control. including perspective, macroenvironment, sales. adjusted impacted continues production overall a the significant monitoring this to million, remain backdrop can anticipate first we our remain We in sentiment closely hopeful should throughout rising and adversely the environment Chris We factors some are the tight costs the mode more launch performance the to first company consumer EBITDA launches that drives We but quarter We most in profitability in interest From year. provide demand. AAM on details as our operating quarter following costs of market. quarter. EBITDA and anticipate the launch and successive the on the XX.X% that quarter. rates is schedules in XXXX, in We continue AAM’s changes $XXX the incrementally And be chain in labor improve the the experienced in to of these exacerbated production in about the stabilize will by This Disruption or supply to quarter. a was focused of

free loss million. was cash experienced in per share first $X.XX. outflow in adjusted quarter, and a first in of the cash adjusted flow of a quarter earnings was XXXX AAM’s AAM $XX AAM’s quarter the use the

electric and Technology me business this exciting continuing technology Today, propulsion can you showed that Day, our of strengths to investment foundation highlights year Let talk advantages portfolio. on tangible slide investment the see of package. about updates is product the and at into some key the community X manifest which Earlier results. our we our

decade. for electric program latter Axles pleased very a AAM Stellantis part announce that to The e-Beam program. of supply are is set with the vehicle future launch to We will in this

community. and systems this that in value any our propulsion we significant the electric capabilities we share can proposition on details but limited and OEM are demonstrating program, We technology are on other further integration clearly to

In great a technology of drive the we several Stellantis, e-Beam number leadership is future is of today announced a of company we support electric growth. we designed multiple architectures. conversations the are edge to to multiple as past AAM example our propulsion the [inaudible], momentum expect Remember, heritage axle with leveraging the how cutting- are with in e-Beam of significant quarters, This and and continue awards vehicle to segments other Jupiter our EV now with OEMs. and and have

provides which commitment a new and access to Mobility made managed the Capital. high-tech Fund, AAM The Additionally, automotive in EnerTech advance companies is vetted Strategic startup investment fully investment Global AAM Venture by in technologies. and with

as again in excited sustainability. for year once recognized a AAM our share This by also our for suppliers in to in America's fourth are XXXX. with time Forbes, that areas most performance the here customer purchasing, logistics. recognition Overdrive From care, Overdrive companies Award, such AAM best of so Motors third after sales, manufacturing the of large which responsible is Newsweek and as receiving made standpoint, General was and the one services, recognized Award recognizes America's business of list employers by we efforts AAM its doing in consecutive

also our ESG perspective, Sustainability we to recently XXXX we are announce published Report. very that From pleased an in April

CDP key this that report suppliers. our first and Council include a all safety way spend diversity, goals. Climate and for Change equity our equitable. Sustainability improving highlights socially our of committed achieving Emission a growing Gas responsible Supplier the inclusion, our in A with rating An diverse of minus Greenhouse while of executive metrics survey, AAM on is our SBTi Some validation and the is properly Clearly, sustainable, increasing business establishing performance hiring to

approximately is which billion is $X.XX approximately $XXX shows EBITDA To adjusted of X%. X.X% adjusted our AAM of billion, from to million, million million, which close a the $XXX to $XXX range to cash free And flow unchanged. in $X.XX comments, my capital targeting sales to $XXX spending of X out slide million guidance, assumes

predict we again, are the and half quality in but improvement, it of is the dynamic, But focused hopeful theme until the past performance In normal stabilization continuation several control, when second started remain and return. will of bringing to we environment see continuous earlier year, and from difficult future guidance. operating the continue some execution, faster. to the unchanged will So does, daily to remains on cost that it years, the performance the in

we've we future, strong drive flow, lies cash that As portfolio, positioning advancing will continue in about many AAM. the securing ahead aim free generating times remarks. I'm excited concludes AAM and very our for efforts to sheet, primary balance communicated profitable and business, my what for before, And towards growth. our our electrification our our legacy future strengthening

May. the Executive our call to me President Financial Chris? and turn Let Vice Chief over Officer, now Chris

Christopher May

cover my our first And David. details morning, today. refer of comments. with I deck you earnings I also will the Okay. the financial as everyone. good of prepared to you, part slide quarter Thank will

net to Metal million Metal million. mix With acquisition So with Market with impact, And volume In the passthroughs billion FX quarter in first other X pricing the Slide let's In shows lower. the XXXX. lowered was the And XXXX approximately $X.XX the XXXX a lastly, sales FX sales. $XX first and XXXX, begin and $XXX go positive of sales AAM contributed walk the to quarter quarter compared to quarter, $X sales. of first quarter and Tekfor sales primary million sales. year-over-year of both was which were to million. first contributor a and increase billion, approximately by $XX ahead $X.XX sales

that year-over-year, truck products key a Overall, flat experienced full American downtime. up generally year-over-year. truck production quarter, the amount size while related During support primary full of the programs were size we North fair was our platforms

million Gross million in profit of to XXXX on move in was first quarter million was profitability. Adjusted in first let's $XXX.X the the first the year. quarter of quarter Now, to $XXX.X versus last compared XXXX. XXXX $XXX.X EBITDA million of $XXX.X as

of the the quarter see walkdown slide mix adjusted can adjusted volume on other In of added year-over-year EBITDA. $X EBITDA You and million X.

and support our other $X performance approximately Net of technology a by electrification inflation, to was increased and million million. development. R&D $XX launches headwind product

color in ramping variance, volatility the we materials, due net of is launch to are some inefficiencies as mix on and for we For up production and significant this quarter. incurred it costs new programs labor inflation a

forward, to to launch expect with and continue second into labor improve the remain, inflation Going costs to quarter thereafter. reduce would we efficiencies stability and

first SG&A. compares of spending million, sales to AAM’s or including XXXX R&D million. in This of the first X% or of cover $XX first approximately the D XXXX million, in now of sales. of $XX.X was quarter SG&A X.X% expense $XX.X me R&D XXXX. in Let the quarter quarter was

our As continue we R&D to new are per opportunities mentioned capitalizing The good propulsion before news to before, on technology, here investment. today. announcement Stellantis million electric we of multiple including around this drive quarter $XX electric we opportunities electrification the range the is the number as in driving growing invest that us, see will continue trend

in to expense interest Net of taxes. and of in first the interest first XXXX. quarter compared $XX.X to on million quarter XXXX, the move Let's was million $XX.X

a debt first the expense an basis, environment of increase. compared first total de $X as income is to quarter quarter our of expense minimis Although, rate quarter the lower rate end is in In our year-over-year XXXX, interest driving of tax the on was at million the rising XXXX.

share $X million or increase per $X.XXper quarter of range, our expect elevated in due effective to XXXX. in an loss quarter items of our loss we Adjusted impact in the share, in release, XXXX was the XXXX. rate this million XXXX, adjusted $X.XX a noted of to period XXXX, of $X.XX into a XX% of Taking our quarter, compared per of all $X.X which somewhat in to share a to account, first income first first in earnings press the current compared the excludes net net allowance. quarter $X.XX For first primarily or valuation the per was the in share of quarter the XX% GAAP tax be in to share earnings

Reflecting were $X insurance historically, equipment in activities, adjusted of quarter plant the $XX.X million. sheet. to section Capital the of working provided We The an million. net statement and and move this in and XXXX is that now free AAM acquisition the XXXX. cash million year. of of incurred $XX.X related first first these payments capital trend was the the the were balance flow activities often expenditures, net cash Net flow first of the experienced we Let's quarter an for sale quarter. proceeds outflow that first from $X was cash XXXX for of the restructuring activity quarter in the by XXXX the quarter of note and for cash use to cash for for impact the quarter flows Cash proceeds in million of the fire operating of operating million. related property, first Malvern $XX.X of inflow

of X.Xx billion, quarter perspective, the net debt reducing strengthen of net of of a intend debt quarter, EBITDA we balance March and reduce over ended utilize a with ratio In continued at From $XXX.X million adjusted leverage we our calculating by AAM the debt LTM free $X.X XX. leverage million, to cash our the first generating the sheet outstanding by to $XX we to continue to debt. an outstanding power flow

for shows X year the slide our of the year, full As rest guidance.

from on Our targets financial provided XXXX XX. unchanged when February them we initially are

for For based sales, year-over-year approximately we be is anticipate target GMTXXX are up X% and North billion we for of range on sales production to flat to key America ranges, $X.XX to North of or X.XX the million million units America targeting upon our to billion and select XX.X programs. our a program a XX.X XX%. sales assumptions XXXX. Underpinning to production This basis the

we of the inflation in launch recoveries continued quarter terms the more considerations, second customer expect the second and cadence weighted of into year. costs half In quarterly would

the remains, year. that While optimistic uncertainty environment the cautiously operating improve are will we throughout

our million $XXX to and is million, is million. million target $XXX target EBITDA $XXX cash adjusted adjusted $XXX flow Our free to

impacted quarter So expected, big more launch had than a this and robust volatility large experienced busy has a with been and truck quarter, efficiencies, spend. by has picture, activity, R&D downtime critical been has

with interest new new earn. even the our bigger products award is picture, our However, business electrification each customer transformed in we is growing, and

David Q&A. call the your stop the participation David? on the time over to for to we today. you going can start so here thank and So call back turn and I'm

David Lim

Chris David. Thank and you,

We you take limit please your have to reserved two. ask some questions. I questions time to would no that than more

please time, to with Jamie? questions that you feel may any this at So proceed free have.

Operator

Instructions] [Operator

first from from John America. Our Murphy of today question Bank comes

John Murphy

factor. I start guys, to performance kind the bar there on X swing is a obviously net inflation just of Good other column and and big slide morning, want

detail just labor give a I'm So sort us more numbers curious you could costs. there around of and bit logistics if the and exact material, launch on little

forward. year. Because getting recoveries how and of think the much the think half those of about about second talked you think to the buckets of I I you we’re alluded we kind towards big better going should kind

Christopher May

Yes, certainly. that question. this I'll take is John Chris,

X I if that you that see look on minus to you the slide costs. million yes, bucket So $⁠XX, would categories basis. a that could break our into launch you three year-over-year referred on of down

know this to of the the we're of accounts about launching XX% AMG a We're some for that us. as continues product launch of you for year to some launching As one is big Colorado backlog the here XX% plus larger variants Canyon this. programs

of year. So is think to quarter and first revenue for of volume getting the more runoff, of as this online we the as comes outside get perspective et scrap, just the from half a start up, through back course our ready, up the here year run towards backlog as rates weighted the cetera

XX% So that's here. economics to about XX%

cetera, then of et XX% the with associated a market. the be inside volatility about to would rest labor, freight, bucket material, think performance that XX% lot and of really So

John Murphy

Okay, about as that's David and win great we X, this congratulations e-Beam then slide helpful. very And Axles news think on is that. Stellantis

a into As like see this of Axles specific sort of something Stellantis? EDUs, the application just sort much Is is Even that, wins other cetera. expand could a at wins to company win? et what this e-Beam you or like beyond door very appears open that initial does that to be potential this how

David Dauch

the Stellantis, very that do also expanded this, across think to and latter decade, portfolio Well, what a we think is win EDUs. about important I the This extensive of R&D our with Stellantis Stellantis, extensive our to so and we to We only most the company. only we're our It e-Beam with other the similar have to John, the in It not means. that launches other of use validates but regards and utilizing electric electrification the with as to partner excellence technology. that there's the heritage operational customers electrification vehicle up not other excited program you paired an well also program this significant opportunities, capability thing, technology, and OEMs on as but know quality capabilities our verifies We're is for part e-Beams have but in we us. this have. the just portfolio pleased

we're AAM. share, it the details very we're this excited today. regards And very, limited some for So news we in announce about here award positive to glad very and of obviously, can but could we

John Murphy

and if I that sorry housekeeping tax normal? can you is alluded how sneak year, XX%, XX% much I Chris, of one what's and rate, cash to for the non-cash that

Christopher May

that mean rate. that's I I Yes, mean technically, would, our book

for $XX year, million. cash Our taxes around the

John Murphy

rate what we normal? think should of Okay, as

Christopher May

cash mean I from Oh, a perspective?

John Murphy

basis I No going mean a I booking forward. -- book cash. mean

Christopher May

think Yes, of current the low range ‘XX, like XX% loan. of under outside

Operator

from comes Ryan from Our JPMorgan. next question Brinkman

Ryan Brinkman

inverter integrated release gearbox. Award and my featuring taking Great, e-Drive refers press I thanks for the with e-Beam to to ask motor technology three I an the one know in question. thought Axle around your Stellantis.

I if providing own that complete mean, are integrating partners you confirm your your maybe speak I that it's think the position integrating think the able you that to to understand when attached cost? approach, components if your better about other the the maybe are others. you're axle a integration, these you're et axle, provide maybe the axle, a than good like system, or to is they in than can means, but of it axle? or able the you’re able units And think components you're efficient when to to components, you or how win the you you're integrated Because is how lower providing then a even JV manage too that? to transmission, just do system components probably systems at into putting that provide are the or complete engine the integrated somewhere you're Or the wanted even case, components rather you should to a we position you cetera. you suppliers attach the How provide how systems providing getting go where you're award. how were Maybe or more able to an the system to else, some axle are because expert. the when to And in

David Dauch

There the and done digest try here. going to there, Axle, doing past. the was in to the I'm integration, traditionally we full of for assembly the to business design, But testing, it lot ICE we've the that just but Ryan, are respond like yes, e-Beam the and validation, the entire

and in heritage CES. you leveraging we at our with we're participated Technology leveraging strength, that our for with supply Day You components clearly like saw system subsystems. in and shared all our their said, our three We but partnering and our you and base we also one

And inverters. we we've ourselves. using and to you in When need of of the same and R&D software their are strategic but to in same as this to with vehicle. software develop time, we're activity the motors case, integration the and continue support side, regards the it of at to to time, inverters us integration work work at entire the ourselves, respect to the things a in comes our motors side in lot But doing software the with to efforts for we a partner we'll mentioned on some all, OEMs

need work in ultimately we and the just for an open doors going e-Beam or Stellantis. comment other a of is lot in here, And question, said as on to up But to jointly we'll together the couldn't other to Axles So well. supply software I as this integrated earlier do of system we OEMs future John's to to able offer happier to be in regards be what side things. to coordinate

to to one, also in supply the customers opportunity other with and e-Beams very as with integrated offer in this about integrated Stellantis, but e-Beam this I'm prepared systems EDUs the ability well. excited So future particular

Operator

Our next with from comes question Barclays. Dan Levy

Dan Levy

for morning. questions. taking good Hi, the Thanks

XQ First, year, a, Mexican for b, for on the talk increase exposure transactional the we've to I if full wanted your bridge guidance then you steel. the the to a ask seen and just and maybe couple of just peso items, discrete on an in could obviously

to $XX more last $XX the market, know headwind. implied for I print the would which think but said you're XQ in million. EBITDA be exposed I to the what's SBQ, million metal you on

Christopher May

Yes, Dan, Chris. this is

thinking in it guide. about relates guess, perspective As the I market, the our peso to metal

the know, perspective. from you is as a So, exposure Mexican currency largest our foreign cost peso

inside Mexico. we you have operations large of As know,

to the subject of we significant, are year volatility on hedge We I level have some rolling a but associated the three with peso, would do program call, peso.

we So years two year, hedges obviously, for that benefit. those of most that benefiting And this placed ago. some are part ago, continue were year, reap currently of to three from last think I some years of the we'll

have dollar. as let's exposure some from XX will call the peso the it XX We transactionally strengthened has to to about

So of that a again, of from have little here this lot protect But we'll hedges bit a that. exposure our will year.

metal to off at rate of market relates we looking sort quarter. metal the coming generally guidance, it current market, forward provide our As through run

end know, the guidance. it on and sort and up our XX% seen tail rate have in first protected, days. to we the quarter. we we embedded May, as activity customers know, and to to pass at lost declined of every down, from first clip early the end flat of do cost XXXX, started at parts We've some exposure declined But a XX% bit end and in changes the clip of But our the April XX and quarter of you up run May. as generally you of in of inside again, this are they the and So, the of quarter, little a up

Dan Levy

clear markets the like very be $XX that to within on the increase quarter metal little sounds million peso. it the just on in so transactional probably there was and on FX, the Peso EBITDA Okay, headwind

Christopher May

Not very much, Correct. correct. Yes.

Dan Levy

Okay, of you. the Stellantis great. Thank win. line And your just then on continuing questions

your you was components of half backlog the the backlog was units drive in of versus disclosed your other half or that think of your I component EV sub-assemblies. past,

playing CPV, I change how Does more trajectory much this focus change on what backlog for? units? of does the you're I with drive more guess So wonder, the this

Christopher May

But terms recent and decade, to it in program how market that vehicle. backlog and ‘XX, products as a we per drive launches ‘XX. the ‘XX we from our change be have supply, part components e-Beam as for in would the latter as not going of $X,XXX of obviously both units, drive plus year be for So per related commentary but large the would backlog, plus. on put so $XX This very our to such applications vehicle large articulate. it Dan, our three does we view have to plus, release you are Axles high when us can I units. content this, It high for

a we about to on market it component this So towards into perspective products sell work and think but side, we change will weight continue clearly we the dollar a does the how versus customers the not more. with

Dan Levy

More more does lower so to of your EV of throughout a opposed larger approach still all a balanced sub-assemblies, as to pieces are this the opportunities? which the sort it of contents? focus some bit is of in terms Or content shift

David Dauch

Dan, David. No, is this

me very to clear. a going balanced Let approach. maintain be We're

components. few As here very suppliers we we're ways can different supply we marketplace one said, that can the approach where of

segments to which we're or supplying third and integrated already supplying differentials, those So e-Beam. which also and sub-assemblies, then item, today the EDUs gearboxes, think be the whether they both of shafts, is think systems, gears the We're industry.

the going and a market in those it for to the There's in out we're So demand continue there do to balance. service we'll market. areas

Dan Levy

squeeze could in. thanks. If Great, just I one more

just more the maybe program CapEx if broadly requirements pursuing or you're for comment on a unit more drive this, win. could like you If

Christopher May

a level the in capital course, very intensity to ones. capital our space wins but Day electrification in as big what's intensity year that to of in, big at to a is a very intensity program, requires that keep is at Yes, little new products. and require of But our product. goals an about perspective, to that large similar Look, to the level when traditional from invest in driveline that the capital capital of X on the program, obviously the the do consistency keep goal certainly, of our today from side. was Technology award beam a launch, and some of earlier a terms Dan. talked perspective, we this bit a this and Chris intensity announced get some leverages buy traditional as capital traditional this, Optimizing this core here. we our we into to of also, But programs it's you key think a similar here do products small

So But this we leverage equipment it intensity similar. have a expect well. to great from an again, opportunity we existing to through perspective, process would as be

Operator

next comes our from question And O'Brien from Tom RBC

Tom O'Brien

on Hi. guys. lines bridge of QX similar full you year EBITDA the taking bridge, Hey, the question. Thanks and gave one, the guys QX. for Along the in then questioning

looks that the a should ramp see relative year, pretty volume, to the remainder though kind as So sizable of on of it obviously QX.

call if guys only have like, And I it know headwind year. then, things since And like for like changed maybe full out, I reverse. then the a then that it but negative don't think million QX. price you was it looks $X you EBITDA on for called negative the pricing, out. million And looks $XX

you since changed QX, two, price, and volume dynamics So in if the remainder the on of talk those to the EBITDA. for year curious those anything's if maybe could

Christopher May

perspective. truck that a playing programs we volume a articulated from the from support, is range how prepared we comments, year full this Tom, pricing size perspective, out perspective, we my in a think From And full especially on I Chris. certainly. see the Yes,

outside backlog a weighted of quarter. these some In our is the backlog also, a volume, quarter of the It as perspective programs addition, more for us. is year of revenue big from launching inside a first we're it's from first

From another sort have come year-over-year on did see key of about. $XX is all a year the and expectation first we within the that's sight to year, yes, So our online of million half of not component That generally discrete stepping the the perspective, a quarter. those we first into pricing think bridge. still

step the progresses. that in year of So little you'll as of bit sort have through a

Tom O'Brien

Okay, constructive price And raised certainly for little my morning a down cut We're the production see on of that Magna global on views thanks. up, a getting perspective issued retail from to guidance, from on follow their pricing then coming OEMs. coming slightly. more folks this production guidance coming starting kind maybe automakers or auto

or curious how just of in of challenging constructive getting issues. is this the kind end Thanks. supply Do clouds kind you general. viewing Just of you are and of feel production auto at still view same chain, types those still things more year, the of that all

David Dauch

customers of I'll David Yes, is downtime This clearly all, chain quarter the matters. from to of regards in that. take in unexpected or related negatively were first Well, first we impacted Dauch. our because supply issues semiconductor

that and highs to material issue still pre-pandemic. just Europe fact that softening typically companies are did reality. going have So and businesses wage but forward dealing regards it there's dealing disruption than with in the The differently before, That's that We're go and still see had and availability rising, demand although the still above uncertainty their the quarter-over-quarter Labor here. We're at a operated we with inflation improving also is volatility the some issues here. you're components that in to raw all of, Energy and both macroenvironment impacts little marketplace. from an economic sticky. future going how still. to continues consumer Obviously, we to as bit We at. in continuing, is challenged a be was are where wise. how so run is Interest a forward we'll sentiment see we aware that. rates

issues, where freight but subsided, increases think still I than they the higher have were before.

XX.X street see But the North So the we getting second do half things addressed at and We've better. that in guided the America. to with of here units need million dealt there. be XX.X year to

to, quarters customer the still We're starts that we're we're need demand. all I operate we end and that marketplace. control. stay marketplace to wrap to prepared things also in But on focused lower we're at if there's but improvement. show the hopeful mean, uncertainty higher to and of it the going that, the and hopeful of the based we we're can to on disruption But Again, that success end to the the volatility up,

Tom O'Brien

sneak any Okay. UAW if incorporate one the with just guidance could impacts, And I GM? potential Does impacts your from in.

David Dauch

need there that prepared accordingly. now. be in into marketplace right whole all regards to our the work to we is We We not. going Absolutely build or can't takes place, then is all incident obviously be issue that do stoppage, so to If potential impacted. forecasting an but

Operator

And our Jonas from comes next Adam question Morgan Stanley. from

Adam Jonas

guys. Hey,

devoted pure this EV year, portion first, or So What and just percentage BEV of CapEx spend your let's products? term to housekeeping. near is a say

Christopher May

the Adam, especially product, but product, of real Just year. But still term, to just, probably pure rough not it that BEV components these starting we're backlog. this that's amount a estimate conventional point. think launching of That's near it’s our this larger of you're at are driving third fair as a year, some this launch some some AMG of of our a like

Adam Jonas

Yes. When that like half do flip? does or when we hit

Christopher May

EV of here well Well, to the transition our additional this component couple associated And with of as it's associated with of on is nearly backlog right going half is then today some over side, product next wins. the the had is decade. latter announcement part we or as because the years half EV

to to continue going just up. step it's So

David Dauch

XX% electrification based What Yes, and I a is billion mean, through or $X.X we're more is backlog opportunities on time. our is ‘XX about new of electrification That backlog Adam, ‘XX that quoting covering base. incremental of this of XX% David. period the today.

grows the space. And grow we'll comments, part of new to to be decade seeing win it's start the the that that, into but latter So as backlog we'll that we as it business. on EV EV year each Chris's going

Adam Jonas

Thanks.

carefully. Just mean, this me let I a follow word up.

even set volume these ago no in just waiting year when targets and frankly. the most there still clinging the a your to there targets EVs, at company just was of Tesla list car look was so the I a a Like there's when a OEM those hype, And outlook world and thinking, like or way. now Tesla I'm for customers ton for they're and year not was close. that profitable Some of volume

opinions. can of setting that products? and type just CFOs here guys. different I'm the some you by that do the radically how flexible and then happen kind it's But call of you because and going be think stay cost when their out there's cashed? industry thinking of the soon, that's this gap different us what I nimble planning to and get this just think have into kind for you people actually my Can it's delivered reckoning and on architectures not help tell Just do us opinion, between Now this or price How may the when contractor? and I remain in wrote may baked checks what's you're people

David Dauch

Adam, this again, is Well David.

possible foremost, in and First as to we're towards technologies. from we've much related to our to EV design to as from be there the some talked standpoint, going utilize a before, converting over as manufacturing as dedicated EV. But and flexible is to operations try ICE equipment past equipment

to to volumes. So point be of your generating need to other are producers smart in to to volumes regards than now We Tesla. right especially need we today, be the All are forecast EV some the just invest. as what we sensitive how

we're still approach issues very, concerns about risk there's to still a part yes, and potentially of come is our going And on here got other that fixed that share up cost adoption along things to of the penetration There's smart absorption address be any of with and we've because important EVs. lot mitigate that to so issues very of uncertainty But, electrification. you regards to raise our lines. regards a those the commercial point. we the are lot for that that and in impact balanced the can in So customers rates a

charging rates the beyond the affordability. the average OEMs itself, penetration. raw it's battery when is vehicle Can And Just the these technology, mass money got are to But cost. to be which And end where we've is. material for or price not? this all now, going adoption looking at market $XX,XXX, going grid about be why systems, the smart at done, a that's electrification down to make the is what volume come of to consumer and right the said it's

Operator

And our from from BNP Paribas. next question comes Picariello James

James Picariello

guys. Hi,

first were seems what and pretty it but Just downtime quarter. to guys these late on the navigate you in factors, well. I would on to first expectation then to surprise the margins biggest, quarter's attribute trend Clearly, performance though that the or able clearest, as sequentially, to customer manage the you was that? your you to relative that for disruption favorable worse? on know Well, key flat touched and it What

Christopher May

performance I the that Yes, impacts associated some bridge tell call schedules. asked dimensionalizing performance year-over-year that And continuing XX% from I'll in nimble be that terms earlier, of challenge. with you, that is volatility would in look, of is of was a in to quarter. quarter, It's what terms with to James, the of that inside bucket XX% production

our to be inventories walks, trying it as this and properly in as quick as can see good with to you well. speed managing have flexing but year-over-year some performance and dragging of customers game, matters nimble, through communication these You trying in

And obviously, handle. to lot not a it's our performance. optimizing it's So

stabilize. future why that's see when we So upside the some things in

James Picariello

I for quarter, second it. of terms profitability set should just the through steady year, launch improvement year? the assume the And Got margin know you out in up costs we some cadence called the for

Christopher May

guidance the half. that's those on year inside our the recoveries first indicate, costs and from weighted half a little some quarter are of of the we'll launch some again, here back versus Yes, But customers second have of towards second discussions the would correct.

James Picariello

could the be on Got or award. it. And my just entire Will last specific? production one it cover the is Stellantis nameplate's congrats variant this

David Dauch

dependent could also they to But Stellantis It'll what adapt be may market needs. their be nameplate there to where be and upon in goes have same Clearly, our able the cover with production we'll that's the adjust derivatives be portfolio for. we other on going based at the looking to product. products time,

Operator

with session. the be floor And any turn ladies like and gentlemen, today's to we'll for I'd to concluding question-and-answer that Lim David closing remarks. over back

David Lim

Jamie. We forward you. Thank and you all who a participated thank talking future. you Have in have of with in on interest this appreciate the And we look certainly to you, AAM. call your Thank good weekend.

Operator

And today's call. you thank conference joining. ladies and gentlemen, with for that do conclude We will

lines. disconnect now may your You

American Axle & Manufacturing (AXL) 5 May 232023 Q1 Earnings call transcript