Nexteer Automotive: Record Launches and Strategic Growth

Nexteer Automotive Group ((HK:1316)) has held its Q1 earnings call. Read on for the main highlights of the call.

Nexteer Automotive’s recent earnings call paints a picture of robust business performance, marked by record program launches and strategic expansions in Motion-by-Wire technology. Despite navigating a challenging tariff environment and potential market volatility in North America, the company showcases effective mitigation strategies and is poised for above-market growth.

Record New Program Launches

In the first quarter of 2025, Nexteer achieved a milestone with 23 new program launches, including 14 dedicated to battery electric vehicle platforms and 19 as new or conquest business. This achievement spans across all regions, with notable launches in North America, EMEASA, and APAC, highlighting the company’s strategic global reach and innovation.

Strong New Business Wins

Nexteer reported securing $0.8 billion in bookings in the first quarter, with expectations to reach $5 billion by the end of the year. The company’s portfolio includes high-end products such as rear-wheel steering and dual opinion EPS, along with the re-securing of a crucial column business with a North American client, underscoring its competitive edge in the market.

Expansion of Motion-by-Wire Portfolio

The company has expanded its Motion-by-Wire chassis portfolio, introducing innovations in Steer-by-Wire, rear-wheel steering, and Brake-by-Wire. This expansion aligns with industry trends and growing demand, particularly in China, positioning Nexteer as a leader in advanced automotive technologies.

Above-Market Revenue Growth

Nexteer is on track to achieve above-market revenue growth, projected to outpace the market by 200 to 300 basis points year-over-year. This growth is significantly driven by partnerships with China OEMs, reflecting the company’s strategic focus on high-growth markets.

Tariff Mitigation Strategies

In response to the dynamic tariff environment, Nexteer has implemented effective mitigation strategies through a regional supply chain approach. The company is actively negotiating with customers and suppliers to manage costs, ensuring resilience against tariff impacts.

Tariff Environment Challenges

The company continues to face challenges from a dynamic tariff environment, affecting non-USMCA compliant shipments and reciprocal tariffs between the US and China. Nexteer remains committed to ongoing mitigation efforts to navigate these complexities.

Potential North America Market Volatility

There is an anticipated uncertainty in North American production volumes due to the tariff situation, with potential volatility expected in the latter half of the year. Nexteer is closely monitoring the situation to adjust its strategies accordingly.

Forward-Looking Guidance

Looking ahead, Nexteer forecasts significant growth with a record number of new program launches and substantial bookings. The company is leveraging its technology leadership to expand its Motion-by-Wire portfolio, particularly in China, and expects revenue growth to surpass market averages by 200 to 300 basis points. Despite the challenging tariff environment, Nexteer remains focused on reducing fixed costs and optimizing supply chain efficiency.

In conclusion, Nexteer Automotive’s earnings call reflects a positive sentiment, driven by strategic expansions and effective mitigation strategies. The company’s record program launches and strong business wins position it well for above-market growth, despite facing challenges in the tariff environment and potential market volatility in North America.