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Dowlais Reports £29m Cash Burn Amid US Tariffs Ahead of American Axle Takeover
ByAinvest
Thursday, Aug 7, 2025 5:37 am ET1min read
Dowlais Group, a car parts maker, has reported a £29m cash burn in the first half of the year due to US tariffs on car part imports. The company is preparing to be acquired by US auto parts giant American Axle & Manufacturing in a £1.2bn deal. Dowlais has received nine regulatory approvals for the takeover and expects to complete the deal in Q4 2025.
British auto parts supplier Dowlais Group plc (DWL.L) reported a significant cash outflow of £29 million in the first half of 2025, primarily due to the impact of U.S. tariffs on car part imports. This cash burn represents a notable shift from the previous year, where the company experienced an inflow of £10 million [1][2].The company, which is set to be acquired by U.S. rival American Axle & Manufacturing (AXL.N) in a deal valued at £1.2 billion, has received nine regulatory approvals for the takeover. The acquisition is expected to be completed in the fourth quarter of 2025 [3].
American Axle & Manufacturing's recent regulatory filings indicate that the company has a significant stake in Dowlais Group plc, with a 1.53% interest in the company's common stock [3]. The acquisition aims to strengthen American Axle's market position in the global auto parts sector.
The cash outflow reported by Dowlais Group is a direct consequence of the increased tariffs imposed by the U.S., which have led to higher import costs for car parts. This financial strain highlights the potential challenges faced by companies in the auto parts industry due to global trade tensions.
The acquisition by American Axle & Manufacturing is expected to provide Dowlais Group with the financial resources and market access needed to navigate these challenges. The deal also signals a strategic move by American Axle to expand its presence in the UK market.
References:
[1] https://www.reuters.com/world/uk/auto-parts-group-dowlais-reports-cash-outflow-first-half-due-tariffs-2025-08-07/
[2] https://www.tradingview.com/news/reuters.com,2025:newsml_L4N3TZ0KV:0-auto-parts-group-dowlais-reports-cash-outflow-in-first-half-due-to-tariffs/
[3] https://www.tradingview.com/news/reuters.com,2025-08-04:newsml_RSD8797Ta:0-reg-northern-trust-corp-dowlais-group-plc-american-axle-mfg-form-8-3-american-axle-manufacturing-holdings/
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