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Genuine Parts to Split Automotive and Industrial Businesses
Auto Business in General Faces High Costs, Economic Uncertainty and Affordability Challenges for Consumers
Genuine Parts Co. will split into two publicly traded companies following a review of options for its automotive and industrial business lines.
The tax-free transaction, which does not require shareholder approval, is expected to be completed in the first quarter of 2027, the company said Feb. 17 in a statement. Genuine Parts plans to hold investor days in the second half of this year to discuss strategic goals for each business, and details such as company names and executive teams will be announced at a later date.
The decision comes at a volatile time for the automotive business, which is grappling with high costs, economic uncertainty and affordability challenges for consumers. Genuine Parts’ aftermarket unit, known for the Napa brand, has more than 10,000 global locations and generated over $15 billion in sales last year.
The company’s Global Industrial business, operating under the Motion brand, specializes in industrial maintenance and repair services. The operations had revenue of about $9 billion last year.
Splitting the businesses “sharpens customer and market alignment, increases clarity and speed, simplifies operations and enables disciplined, business-specific investments to unlock long-term value,” CEO Will Stengel said in the statement.
Separately on Feb. 17, Genuine Parts announced adjusted fourth-quarter earnings of $1.55 a share, short of the $1.81 average of analyst estimates compiled by Bloomberg. Net sales of $6.01 billion were also slightly below expectations.
Shares of Genuine Parts fell 6.9% as of 7:29 a.m. before regular trading in New York.