Mike Tyndall

Mike Tyndall from HSBC Holdings plc asked about the operating leverage in North America, specifically why the volume drop-through seemed low despite strong shipment growth, and if this indicates a longer path to cadence. He also questioned the impact of the Brazilian real on South America's industrial performance and future margins.

Answer

CEO Antonio Filosa explained that strong volume and pricing growth in North America in H2 2025 was partially offset by mix effects due to technical constraints in light-duty and heavy-duty truck production, which are now resolved. He expects mix improvement in 2026 from increased truck production and higher HEMI V8 engine demand. For South America, he cited FX headwinds in Brazil and unrecovered price differences in Argentina in H2 2025, with a focus on cost reduction and price recovery for 2026. CFO Joao Laranjo added that a specific supplier provision impacted South America's H2 2025 industrial costs, which will not carry over to 2026.