Valeo sales fall 2.3% in third quarter as global vehicle production declines
Key Facts
Valeo's sales fell to 4,881 million euros in the third quarter of 2026, according to the company's quarterly sales statement, as global vehicle production declined. Sales stood at about 4,997 million euros in the corresponding period of 2025, marking a reported year-on-year decline of 2.3%. On a like-for-like basis, sales fell 2.6% over the same period. The decline followed sales growth on that basis in the first half of the year. Against the backdrop of the sector's performance, Valeo said global vehicle production fell 1.6% year on year in the third quarter. The company based its production estimate on data from S&P Global Mobility. Valeo's sales decline, both as reported and on a like-for-like basis, therefore exceeded the drop in global production during the quarter.
In China, Valeo's original equipment sales totalled 534 million euros in the third quarter of 2026, according to the regional sales table in the company's statement. That compared with sales of 576 million euros in the corresponding quarter a year earlier. The business posted a like-for-like decline of 12.9%, steeper than the fall in the company's overall sales on the same basis. Valeo had described Chinese market conditions as weak and volatile in its note ahead of the quarterly sales release. By contrast, it described conditions in Europe and North America as stable to slightly positive. In that note, it said markets were experiencing "stable to slightly positive conditions in Europe and North America, and weakness and volatility in China".
Valeo's sales totalled 10.4 billion euros in the first half of 2026, according to its results statement for the period. It posted a like-for-like increase of 0.7% from the corresponding period a year earlier. On profitability, its operating margin reached 5.0% of sales in the first half, according to Investing.com's coverage of the company's results published in July. That equated to operating profit of 514 million euros, under the definition of operating margin used in those results. The website reported at the time that Valeo shares jumped more than 3% following the first-half results. The share price rise in July accompanied the release of those results, before the third-quarter sales figures were published in October.
On liquidity, Valeo's free cash flow rose to 242 million euros in the first half of 2026, according to the company's results statement for the period. Free cash flow stood at 100 million euros in the corresponding half of 2025. The year-on-year increase was 142%, compared with the limited sales growth recorded in the first half. In its third-quarter sales presentation, Valeo confirmed annualised savings of 300 million euros from its internal measures starting in 2026. The company described these savings as stemming from "internal optimisation measures" in its presentation of business performance during the period of declining sales.
The annual guidance in Valeo's note ahead of the third-quarter results targeted sales of between 20 and 21 billion euros for 2026. The note also included a target operating margin range of between 4.7% and 5.3% of sales for the same year. Its free cash flow target exceeded 400 million euros, after net financial expenses. Looking ahead, Valeo said in its third-quarter sales presentation that it expected sales to rise sequentially in the fourth quarter. The company linked the expected increase to usual seasonal patterns, saying it expected "a normal increase in the fourth quarter compared with the previous quarter, based on normal seasonal patterns". Valeo's financial calendar set 25 February 2027 as the date for the release of its 2026 results.