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American Axle (AXL) to Open Plant in Spain to Meet Demand

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American Axle & Manufacturing Holdings, Inc. (AXL - Free Report) announced its plan to expand its operation in Spain that will support its customer growth in Europe. The facility will be situated in the industrial area of Viladecans, Spain.

Located 20 kilometers to the southwest of Barcelona, the 15,000-square-meter facility is set to open in January 2019. The new hub will be created by consolidating the company’s existing two smaller facilities, situated near Gava. The facility will employ 170 people if it works at full capacity. It will manufacture powertrain components for auto manufacturers in Europe.

Per management, the expansion is in sync with American Axle’s strategy to diversify and expand its global customer base and product mix. The new facility in Barcelona will aid the company to cater to customers’ demand.

American Axle & Manufacturing Holdings, Inc. Price and Consensus

The hub will manufacture a whole range of damper products, including — compression dampers, PV bonded dampers, isolation pulleys, in-mold bonded dampers and damped gears.

With increasing hybrid applications for vehicles, automakers are focusing to decrease the size of engines, which ramps-up the demand for components like damped gears and isolation pulleys. Per management, American Axle’s new facility in Spain will look after such customer requirements and continue to meet its performance and quality expectations.

The company is a leading designer, engineer and manufacturer of automotive driveline, and powertrain components for light trucks, sport utility vehicles (SUVs), passenger cars, crossover vehicles, and commercial vehicles.

Price Performance

In the past three months, American Axle’s stock has moved up 3.8%, outperforming 0.9% increase of the industry it belongs to.

Zacks Rank & Other Stocks to Consider

Currently, American Axle has a Zacks Rank #2 (Buy). Other top-ranked stocks in the auto space are Magna International Inc. (MGA - Free Report) , Visteon Corporation (VC - Free Report) and Ferrari N.V. (RACE - Free Report) . Magna International and Visteon carry a Zacks Rank #2  while Ferrari sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Magna has an expected long-term growth rate of 8.5%. Shares of the company have risen 26.9% over the past year.

Visteon has an expected long-term growth rate of 15%. Shares of the company have risen 25.9% over the past year.

Ferrari has an expected long-term growth rate of 17.3%. Shares of the company have risen 57% over the past year.

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