Dive Brief:
- Auto parts maker Magna International will build a multimillion-dollar manufacturing facility in Mesa, Arizona, the Arizona Commerce Authority announced on Aug. 8.
- The nearly 230,000-square-foot facility will be located in Power Industrial Park and is “expected to create hundreds of new jobs,” according to the release.
- While a Magna spokesperson said equipment installation is underway, the company has not disclosed a start date for production.
Dive Insight:
The Arizona facility will utilize “innovative technology and virtual tools, such as simulations,” to facilitate the integration of new products, according to the release.
Magna’s entrance into Arizona builds on the state’s already booming automotive ecosystem. Electric vehicle manufacturers Lucid Motors and Nikola, as well as automated vehicle technology companies such as May Mobility and Gatik, have factories in the area.
Magna has 58 manufacturing and assembly facilities elsewhere in the U.S., according to its website. Last July, the Canada-based company invested over $790 million to build three plants in Tennessee, two of which are a part of Ford’s BlueOval City supplier park.
Yet recent delays at the Ford plant have impacted Magna’s 2026 sales projection. According to its Q2 results, sales projections are now $44 billion to $46.5 billion, down from $48.8 billion to $51.2 billion previously. The automaker delayed its work on a next-generation electric truck until 2026 that was originally supposed to start production by the end of 2025.
“Our updated 2026 Outlook reflects customer program updates and a tempered view on mid-term electric vehicle penetration rates, particularly in North America,” Magna International CEO Swamy Kotagiri stated in the Q2 press release. “While we have reduced our sales forecast, we are taking a number of concrete actions to mitigate the sales impacts and continue to expect margin expansion and strong free cash flow growth.”
Magna is also seeing headwinds with other EV program delays, cancellations and reduced volumes. “The most significant to us being Ford vehicles in Oakville and BlueOval City, GM’s full-size electric pick-ups and SUVs, and a new program for a North American-based EV manufacturer that was planned for southern U.S. and Mexico,” Kotagiri said in a Q2 call.
Magna touts its full-system approach to automobile manufacturing, which it’s continuing to improve. In May, the company acquired power module business HE System Electronic GmbH, which aims to accelerate its in-house development of car modules and leverage its combined technical and manufacturing competencies, Kotagiri noted in the call.
"We remain focused on continuous improvement, efficiency and launches. This year alone, we are taking actions in more than 40 divisions to restructure, consolidate or wind down operations. We are right-sizing our complete vehicle operations and we are driving profitability through smart automation and factory of the future initiatives," Kotagiri said.
