Gentherm's Q2 2025: Unpacking Contradictions in Production Forecasts, Asia Strategy, and Revenue Expectations

Industry production forecasts and company performance, Asia market performance and strategy, revenue and EBITDA margin expectations, China production and market share ambitions, and production outperformance in Asia, specifically China, are the key contradictions discussed in Gentherm's latest 2025Q2 earnings call.



Automotive New Business Awards and Market Share:
- Gentherm secured $620 million in automotive new business awards in Q2 2025, with year-to-date awards totaling $1 billion.
- The increase in awards is driven by strategic wins, such as the Ford F-Series platform, and a strong customer approach that engages directly with OEMs.

Operational Efficiency and Margin Improvement:
- Gentherm achieved an adjusted EBITDA margin of 12.2% in Q2 2025, a 100 basis points improvement from Q1.
- The improvement was driven by a focus on operational efficiency and cost containment, despite challenges from higher material costs and labor expenses.

Expansion into Near-Adjacent Markets:
- Gentherm secured 5 new awards in Q2 2025 across various end markets, including 2 new commercial vehicle programs and 3 valve awards for powersports platforms.
- This expansion is part of a strategy to leverage existing products and technologies into new markets, with a focus on rapid market penetration.

Strategic Shifts in China and Customer Mix:
- Gentherm aims to shift its China customer mix to be more aligned with the overall market, targeting a 60-40 split between global and domestic OEMs by next year.
- The strategic pivot is driven by increased revenue from Chinese domestic OEMs, which now represent 70% of the company's Chinese awards, up from 50% in previous years.