MEXICO · AUTO PARTS
Key Facts
- The country Mexico is the largest trading partner of the United States, and Nemak, based in Monterrey, makes aluminium car parts.
- What happened Third-quarter sales were US$1.5 billion, up 22%, and EBITDA (earnings before interest, tax, depreciation and amortisation) was US$174 million, up 21%.
- The profit Net income fell from US$25 million a year earlier to about zero after US$24 million of write-downs on closing or reshaping plants.
- The miss Each share earned 0.0018, far below the consensus forecast of 0.12.
- The debt Net debt stood at US$1.76 billion on 30 September 2026, or 2.8 times the last twelve months of EBITDA.
- What it means for you Half of Nemak’s sales come from North America, so US car output and the USMCA trade pact drive its results.
- Power Index Mexico ranks 2nd of 14 in The Rio Times Latin America Power Index, with 71.4 points (October 2026 edition).
Nemak sales jumped 22% to US$1.5 billion in the third quarter, the Mexican car-parts supplier said on Tuesday 20 October 2026. Yet net profit fell from US$25 million a year earlier to about zero.
For US readers, Nemak matters because it casts aluminium parts for engines, gearboxes and electric-vehicle structures that end up in cars sold in America. It is described in our Company Intelligence profile of Nemak, and its shares trade in Mexico City under the ticker NEMAKA.
What the Numbers Show
Nemak sales reached US$1.50 billion in the quarter that ended on 30 September 2026, against US$1.23 billion a year earlier. EBITDA, a measure of operating cash earnings, rose 21% to US$174 million.
Operating income was flat at US$25 million, against US$26 million in the third quarter of 2025. Net income was roughly break-even, against US$25 million a year before, and earnings per share were 0.0018 against an analyst consensus of 0.12.
Why the Profit Disappeared
Nemak booked asset write-downs of US$24 million tied to what it calls footprint optimisation, meaning it is reshaping or closing some plants. Financial expenses also rose, with interest costs up 45% to US$42 million in the quarter.
An income tax benefit of US$6 million softened the blow, compared with a US$28 million benefit a year earlier. Over nine months the company still earned US$8 million, against a loss of US$16 million in the same period of 2025.
The Swiss Acquisition Lifts Sales
Much of the growth comes from the car-parts business of GF Casting Solutions, part of the Swiss group Georg Fischer. The deal, valued at US$336 million, Cluster Industrial reported, closed in February 2026 with nine plants in Germany, Austria, China, the United States and Romania.
Europe’s revenue rose about 30% to US$522 million, and the Rest of the World rose about 32% to US$231 million. Higher aluminium prices also lifted Nemak sales, because the metal cost is passed on to customers.
North America Under Pressure
North America brought in US$747 million, up about 15%, with EBITDA of US$73 million, up 9%. Nemak said product mix and price talks with customers outweighed the effect of a stronger Mexican peso against the US dollar.
Nemak sales in North America faced weaker demand, as customer production fell 6.2% and total light-vehicle output slipped 3.8% to about 3.8 million units. US new-vehicle sales held steady at an annual pace of about 16.4 million.
Debt, Cash and a New Georgia Plant
Net debt, meaning borrowings minus cash, was US$1.76 billion on 30 September, up 10.3% from a year earlier. During the quarter Nemak refinanced its €500 million (about US$561 million) of senior notes due in 2028 through local bonds and bank loans.
Capital spending rose 43% to US$100 million, mostly for the Georgia plant, due to start production in the fourth quarter. In July, El Cronista México reported that chief executive Hervé Boyer expected up to US$200 million of yearly revenue from it by 2027 or 2028.
What It Means for US Readers
Nemak sales depend on carmakers that sell in the United States, so they gauge factory demand rather than consumer demand. In July, El Cronista México reported no direct tariff exposure, though stricter USMCA rules of origin remained a worry, as our USMCA report explains.
For investors, Nemak sales growth comes with thin profit and heavy debt, a mix that can swing with aluminium prices and the peso. Our Mexico market report for 20 October covers the trading session just before the release.
What Is Not Known
Nemak has not said which plants are affected by the US$24 million of write-downs, or whether more will follow. How its shares reacted to the results is not yet clear.
Nemak’s October release is silent on the US$640 million EBITDA target that El Cronista México reported in July. Nine-month EBITDA of US$472 million would leave US$168 million to find in the fourth quarter.
What Comes Next
Nemak scheduled its third-quarter earnings webcast for 1 p.m. Eastern Time on Wednesday 21 October 2026. Production is due to start at the Georgia plant before the end of the year.
Investors will watch the fourth-quarter report, expected early next year, to see whether EBITDA moves toward the full-year target. Aluminium prices, the peso and the USMCA review remain the main outside forces.
More: Mexico news in English, every day from The Rio Times.
Frequently Asked Questions
What does Nemak do?
Nemak is a Mexican company whose sales come from aluminium parts for engines, transmissions, car bodies and electric-vehicle batteries. Its customers are major carmakers in North America, Europe and Asia.
Why did Nemak’s profit fall to zero?
Nemak took US$24 million of write-downs linked to reshaping its plant network and paid higher interest on its debt. A tax benefit of US$6 million softened the result.
How much did Nemak earn in the third quarter?
Nemak sales were US$1.50 billion and EBITDA was US$174 million, up 22% and 21% from a year earlier. Net income was about zero, against US$25 million in the third quarter of 2025.
Is Nemak affected by US tariffs?
According to El Cronista México in July, Nemak sees no direct tariff exposure, and customers on ex-works contracts bear tariffs themselves. It watches possible changes to USMCA rules of origin, which could require more US content.
Where does Nemak trade?
Its shares trade on the Mexican Stock Exchange under the ticker NEMAKA. It reports its results in US dollars.
Sources: Nemak, 3Q26 earnings release, 20 October 2026; El Cronista México, Nemak starts its Georgia megaplant and manages USMCA risk (July 2026, cited for the Georgia plant, tariff and EBITDA-target remarks), 23 July 2026; Cluster Industrial, Nemak closes the GF Casting Solutions purchase, 17 February 2026.
In depth
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