Leoni partially restarts production in Ukraine, expects lower revenue this year

Fujikura

23/03/2022 08:48

BERLIN, March 23 (Reuters) - German cable and harness maker
Leoni  LEOGn.DE , which supplies automakers with wire harnesses
crucial for car production, has partially revived its two
factories in Ukraine after a temporary halt due to Russia's
invasion, the company said on Wednesday.
    Some production had been relocated to Leoni plants in other
countries, the supplier said.
    Carmakers including BMW  BMWG.DE , Volkswagen  VOWG_p.DE 
and Mercedes-Benz  MBGn.DE  have been forced to cut shifts and
reduce working hours at factories in Germany as the lack of
parts from Ukraine limited their production
capacities. urn:newsml:reuters.com:*:nL5N2VP53Y urn:newsml:reuters.com:*:nL5N2VJ158 urn:newsml:reuters.com:*:nL5N2VI1NM
    Western Ukraine, with its low-cost, highly-skilled workforce
and proximity to Europe's car factories and a wealth of raw
materials, has grown into a major production hub for wire
harnesses, with Japan's Fujikura  5803.T  and France's Nexans
 NEXS.PA  among those producing there. urn:newsml:reuters.com:*:nL2N2VE1GC
    Some factories remained operational even after the war began
but many were forced to shut down or curtail production.
    Leoni has 7,000 employees in Ukraine and 2,000 in Russia,
and had expected to bring in just under 400 million euros 
($440.60 million) in revenue from the two countries this year.
    The company, which grew its revenue and earnings before
interest and taxes this year despite rising logistics costs in
the second half, expects lower revenue and earnings this year
due to the impact of the war and wider supply chain disruptions,
it said on Wednesday.
    
($1 = 0.9079 euros)

 (Reporting by Victoria Waldersee
Editing by Madeline Chambers)
 ((Victoria.Waldersee@thomsonreuters.com;))