Back to top

Analyst Blog

Owing to the rising demand for airbags in China and other Asian markets, leading developer of automotive safety systems Autoliv Inc. (ALV - Analyst Report) announced that it will be investing roughly $50 million to build a textile center in China. Autoliv will enjoy a competitive advantage by cutting supplier costs through vertical integration.

Within the textile center, there will be a weaving plant, an airbag cushion plant and a development center for airbag cushions and textiles. The weaving plant will span across over 8,000 square meters and will employ 150 workers. Autoliv will be producing airbags deploying ‘one-piece-woven’ (OPW) technology in this plant. This technology will assist in making the airbag cushions ready-made on the weaving loom.

Autoliv will also build another manufacturing building in this site as an existing plant in Shanghai will be relocated here. The move will expand production capacity and will provide employment opportunity to around 1000 employees. The company also intends to produce woven fabric for traditional ‘cut and sewn’ cushions in this plant.

The development center will be focusing on standardized designs for the Asian region. With the completion of the project, Autoliv will also boast of having in-house manufacturing of OPW in all of its Europe, America and Asia regions once this center is complete.

Last year, Autoliv produced 70 million airbag cushions in-house and purchased 40 million from external suppliers for its total production of 110 million airbags. This textile center will increase the level of in-house component sourcing and standardize designs globally. It will also enable shortening and streamlining of Autoliv’s supply chain.

Autoliv carries a Zacks Rank #3 (Hold).

Other stocks that are performing well in the industry include Visteon Corp. (VC - Snapshot Report), Magna International Inc. (MGA - Analyst Report) and Johnson Controls Inc. (JCI - Analyst Report). Visteon and Magna carry a Zacks Rank #1 (Strong Buy), while Johnson Controls has a Zacks Rank #2 (Buy).
 

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
RPC INC RES 24.91 +8.35%
LITHIA MOTO… LAD 94.59 +4.60%
DELTA AIR L… DAL 39.15 +3.90%
FLAMEL TECH… FLML 14.51 +3.50%
SOUTHWEST A… LUV 28.87 +2.92%