Sumitomo Electric Industries Ltd., a supplier of electrical wiring harnesses to automakers including Toyota Motor Corp., says it expects to more than double profit this year, beating analysts’ estimates on new orders.
“Some carmakers asked us to produce parts they previously ordered from our competitors including Delphi,” said Sumitomo president Masayoshi Matsumoto, in an interview with Bloomberg. “They may be eliminating parts makers damaged by the financial crisis that lost capacity to invest in new product lines.”
Pre-assembled wiring harness sets used to control the electrical components in cars will contribute the most to the Osaka-based company’s recovery, Matsumoto said.
Sumitomo Electric reports that wiring harness orders are increasing from Volkswagen AG, Fiat SpA, Hyundai Motor Co. and other makers, "even after governments stopped paying incentives for new car purchases."
“The market isn’t assessing the company fairly,” added Shinya Yamada, an analyst at Credit Suisse Group AG.
FULL STORY: Bloomberg - BusinessWeek
