Magna International Inc Q4 2021 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Peter Sklar - BMO Capital Markets Equity Research - Analyst : Just looking at your initial 2024 guidance, you're showing a lot of equity income growth over the plan period. I take if that's coming from some of these joint ventures, the partnership with LG, the partnership with HASCO. So I'm not surprised that the revenue is ramping up, but I was surprised at the growth of equity income, given that there would be initial ramp periods as those joint ventures begin to build. So just wondering if you could add a little flavor on what's driving the equity income growth?

Question: Peter Sklar - BMO Capital Markets Equity Research - Analyst : Okay. Another question I had is, I'm a little lost on how many e-drive awards you've received and have announced. Like just I forget when it was, I think it was last week or recently, you issued the press release on the Volkswagen platform where you're providing the secondary drive. So as I recall last time you spoke up three major e-drive awards and it's the Volkswagen program you talked about last week, is that part of that? Or is that a fourth program? Maybe you could just review where you are on e-drive awards?

Question: Peter Sklar - BMO Capital Markets Equity Research - Analyst : Okay. And the LG partnership, is that for components for the e-drive system? Or will the joint venture do the entire e-drive system? Or a bit of both?

Question: Peter Sklar - BMO Capital Markets Equity Research - Analyst : Okay. And then just lastly, on the complete vehicle assembly where results were pretty strong in terms of operating income. You attributed that partially to government research and development incentives. I'm just wondering what they're related to and what was the magnitude -- those incentives must have been pretty significant if you called them out?

Question: Mark Neville - Scotiabank Global Banking and Markets, Research Division - Analyst : I just want to make sure I understand and sort of to go back on this, what's happening in complete vehicles? So volumes will be flat. Sales are down, but that's Fisker accounting but you also have the BMW rolling off in 2024. Is that correct?

Question: Mark Neville - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. And is there a different accounting for Fisker, is that right too?

Question: Mark Neville - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. Given the Fisker accounting, if it's just value-add, wouldn't sort of -- shouldn't we assume or wouldn't normally the margin be higher?

Question: Mark Neville - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. Pat, you mentioned some -- just -- you throwed some numbers in terms of inflationary pressures, I think you said $275 million for 2022. I missed the split.

Question: Mark Neville - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. I'm just curious what -- sort of what steps you can take, if any, surrounding the labor and energy? Again, I appreciate commodities move around, but I guess labor feels a little more structural. So what are some of the things you can do to sort of push that through or deal with that?

Question: Mark Neville - Scotiabank Global Banking and Markets, Research Division - Analyst : Okay. One last question. Just in the 2024 outlook, I understand there's no comments around M&A, but just curious to get your updated thoughts there?