German automotive supplier ElringKlinger (Dettingen; www.elringklinger.com) has downgraded its sales and earnings outlook for 2008, due to “significant deterioration” in key economies, in particular the dramatic downturn in North American and European vehicle production, which has led to a fall in volume sales to OEMs. The company points to a “lack of tangible signs” that market conditions will improve in the fourth quarter.

In 2008, organic sales at group level are expected to be flat at the EUR 608.7m posted for 2007. Earlier forecasts had suggested growth of 5-7%. Including figures for recent acquisition SEVEX, a Swiss manufacturer of thermal and acoustic shielding systems, and the expansion of its ownership in Japanese gasketing manufacturer ElringKlinger Marusan, nominal sales figure are predicted to be 9-10% higher, with adjusted net income at EUR 55-56m, down from EUR 67.2m a year ago. To bolster the bottom line, the company plans to adjust its production processes and cost structures and leverage its R&D potential to enter new businesses.

The auto supplier said it does not expect to see substantial improvement in business conditions in the first half of 2009, due to continued market weakness in North America and Europe, as well as slower growth in emerging automotive markets. In the longer term, however, it believes its existing portfolio and “extensive technology pipeline” encompassing fuel cell components, a diesel particulate filter and the new injection-mouldable PTFE material “Moldflon” will allow it to return to organic growth of at least 5-7% annually.