BMO Capital notes that Magna (MGA) announced the award of a vehicle assembly business with Chinese OEM Xpeng (XPEV) for two electric vehicle models at its Magna Steyr plant in Europe starting in Q3/25. The firm believes that the Xpeng contract award is marginally positive for Magna as it seeks to improve the capacity utilization and margin profile of its complete vehicle assembly unit. Importantly, this development highlights the breadth of Magna’s OEM relationships globally, which could support improving content per vehicle outside North America. BMO has an Outperform rating on Magna with a price target of $47 on the shares.
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