Share price of Magna International Inc. (MGA) rallied 1.3% to $104.22 on Sep 23, after the company announced plans of building two new facilities in the Sanand region of Gujarat, India. These new facilities are part of the company’s initiative to expand its global engineering and manufacturing footprint. The plants will also help the company enhance its operations in India with increased vehicle production.
Magna International announced that it will be producing complete seat systems for leading automakers in one of these two new facilities. The seat system facility will span across 215,000 square feet and employ around 200 workers. However, volume production in the plant is expected to begin in 2015.
In the second facility, the company will produce body and chassis systems for various customers. This facility will spread over an area of 356,000 square feet and will employ approximately 400 employees. This facility will also initiate production in 2015.
Magna International enjoys rising product demand in India and provides its Indian customers with product and process expertise locally, together with global program coordination through a body and chassis engineering center in Bengaluru, seating and full-vehicle engineering facilities in Pune, and a latch and closure engineering unit in Chennai. With this, Magna International believes that it is well positioned to support the increase in vehicle production in India.
Other than the two planned facilities, Magna International has 9 manufacturing locations and four engineering centers in India. At present it employs 1,600 workers in the nation. The other facilities of Magna International in India include a body and chassis plant in Pune which comprises 279,000 square feet. This plant conducts blanking, stamping, forming, welding and assembly on programs for customers like General Motors Co. (GM), among others.
Magna International has another body and chassis plant located in Chennai which carries out stamping, welding and assembling activities for Ford Motor Co. (F) and Nissan Motor Co. Ltd. (NSANY) in India and also for customers outside India. Other than these, Magna International owns a seating design and engineering center in Pune and a vacuum pump manufacturing facility in Bengaluru.
Based in Aurora, Canada, Magna International is a leading manufacturer and supplier of automotive components. The company currently carries a Zacks Rank #2 (Buy).
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