June 16, 2009 / 3:14 PM / 8 years ago

UPDATE 1-Linamar near break-even, no interest in deals -CEO

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 * Linamar can break even at 8-10 mln unit production
 * Recovery will be slow, take at least five years
 * Not interested in taking over weaker rivals
 DETROIT, June 16 (Reuters) - Canadian auto parts maker
Linamar Corp LNR.TO does not see any near-term spike in auto
production volumes in North America, but aggressive cost cuts
have sized the company for a break-even at current depressed
levels, its chief executive said on Tuesday.
 Chief Executive Linda Hasenfratz also said the company was
in a "much stronger" position than other auto suppliers on the
balance sheet front but has no interest in acquiring weaker
rivals because it does not need additional capacity.
 "Production has never been worse but once we get through
this period of restructuring, the situation will improve. It's
certainly my feeling that we're at the trough at the moment,"
Hasenfratz told Reuters on the sidelines of the National Summit
in Detroit.
 "But it will be a slow recovery; I don't expect to see a
spike in terms of production in the coming months or even next
year."
 Hasenfratz said most automotive suppliers have right-sized
their organizations to break even somewhere between 8 million
and 10 million units of production.
 "So just as soon as we get over that level, those companies
will start to be profitable again, with ourselves included,"
she said.
 The auto parts industry has been in crisis due to the steep
decline in global auto sales. The Chapter 11 bankruptcy filings
at Chrysler and General Motors Corp GMGMQ.PK, and the
temporary idlings of their plants to cut production and reduce
inventory, have added to the difficulties.
 Hasenfratz said the company has maintained a "reasonably
good" balance sheet but has little interest in taking over
weaker rivals at this point.
 "I would be much more interested in taking over work,"
Hasenfratz said. "We have a great deal of assets open and
available. I don't need additional capacity," she added.
 (Reporting by Soyoung Kim, editing by Matthew Lewis)


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