Magna CEO sees “huge opportunity” in ongoing tariff war
- August 19, 2018
Magna CEO Don Walker has told CNBC money columnist Jim Cramer that the Trump administration’s tariff campaign may have a silver lining.
Walker, interviewed on Cramer’s “Mad Money” show, said that while Magna took a $60 million hit thanks to the US tariffs, the company’s multi-billion-dollar market cap and revenue mean it can absorb the damage and take a longer term view that is more positive.
"I think the industry is the highest-tech industry in the world," Walker told the CNBC columnist. "We have lots of technology, we're spending a lot in R&D, so I think there's huge opportunities globally in the automotive industry."
Magna, while a Canadian based company, has more employees (25,000) in the US than it does in Canada (23,000), making it an almost textbook case for the impact of the transnational trade war that seems to be brewing between the two countries.
For the second quarter Magna posted record sales and record earnings, Walker said it lowered its full year forecast for North America thanks to the anticipated effect of the US tariffs.
The company has a market cap of $18.7 billion and $41 billion in revenue, meaning that even a $60 million hit from the tariffs can’t do a lot of damage.