From AFX News Limited

SOUTHFIELD, MI -- Automotive supplier Lear Corp. on Thursday lowered its 2006 financial guidance because of recently announced production cuts by U.S. carmakers. Lear, a key supplier to General Motors Corp., Ford Motor Co. and Chrysler Group, said production cuts would take about $300 million off its previous sales forecast of $18 billion.

The company now expects to miss by 15 percent its previous operating earnings target of $400 million to $440 million -- meaning a range of $340 million to $374 million.

Lear said the production cuts will adversely impact the third and fourth quarters and all of its business segments. About two-thirds of the decline is in the fourth quarter and skewed toward the interior segment.

Last week, Ford Motor Co. said it will slash staff and shutter additional plants in an effort to slow losses at its North American operations and save $5 billion a year by 2008. German carmaker DaimlerChrylser AG lowered its 2006 operating profit forecast, saying Chrysler expects a $1.52 billion loss in the third quarter. GM already announced plant closings and sharp staff reductions to reduce operating costs.

Lear plans to report third-quarter results on Oct. 26.

Lear shares fell $1.37, or 6.7 percent, to $19.01 in morning trading on the New York Stock Exchange.

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