ENGINEERING group GKN has warned the slowdown in the automotive market could spread to Europe as its first-half profits fell by 24 per cent, hit by difficult conditions in the US.
While there were signs US car production "may be stabilising" GKN said the picture was less clear in Europe.
"It is some time since the short-term prospects for the major economies have been so uncertain," chief executive Marcus Beresford said.
GKN, a supplier to Nissan's Sunderland plant, generates two-thirds of its revenue from supplying parts and components to the major car manufacturers.
A 13 per cent fall in US car production was blamed by GKN for pre-tax profits in the six months to June 30 falling to £198m from £259m before one-off costs. Operating profits in its automotive division, which draws a large part of its income from Ford, Daimler-Chrysler and General Motors in the US, fell 25 per cent.
Mr Beresford said car production remained "relatively steady" in Europe in the first half, but there had been a sharp fall in orders for parts for off-road vehicles due to the effects of BSE and foot-and-mouth, and he warned: "No short-term recovery is anticipated."
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