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Magna International Inc. posted record sales and a sharp rise in profit in the third quarter, but cut its outlook for 2018 on lower car sales.

Don Walker, chief executive of North America’s biggest maker of auto parts, said on Thursday that the company, based in Aurora, Ont., is beginning to see the impact of a wave of tariffs on aluminum, steel and Chinese imports to the United States.

On a conference call with analysts on Thursday, Mr. Walker said sales outpaced global auto production but missed the company’s expectations. As a result, Magna reduced the upper end of its outlook for 2018 by US$100-million. The full-year profit range is now US$2.3-billion to US$2.4-billion, Magna said in its financial results released on Thursday morning before markets opened.

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For the three months ending Sept. 30, Magna’s profit rose to US$554-million, or US$1.62 a share, from US$512-million (US$1.38) in the third quarter of 2017. Revenue increased to US$9.6-billion from US$8.8-billion.

Investors responded to the third-quarter results by driving up Magna’s share price by 6 per cent on the Toronto Stock Exchange on Thursday. Magna stock is down by 4 per cent this year, nearly matching the 5-per-cent decline in the TSX composite index.

The automotive and metal sectors have been at the centre of a trade war launched by U.S. President Donald Trump. The U.S. administration has pursued an increasingly protectionist trade policy, even as it negotiated a new free-trade agreement with Canada and Mexico. In the spring, the United States applied tariffs on imported aluminum and steel, prompting Canada and other countries to respond in kind. The United States also levied tariffs on Chinese goods and has threatened to raise the rates.

Ford Motor Co. said in September that Mr. Trump’s tariffs will cost the company about US$1-billion in 2018 and 2019, even though much of its steel and aluminum is from domestic sources. Honda Motor Co. has voiced similar concerns, saying higher steel prices have driven up costs by hundreds of millions of dollars.

There are fears consumers facing higher car prices will stay away from auto dealers, hurting economic growth.

For Magna, the tariffs added costs of US$8-million in the third quarter, a sum that could climb to US$15-million a quarter if the United States follows through on threats to raise tariffs on Chinese components, said Magna, which makes complete cars and auto components and has more than 400 facilities in 27 countries.

“My view is the tariffs are hurting our U.S. plants more than they are hurting other areas, because there are some duty drawback and remission programs in place” in other countries, said Mr. Walker, who added he hopes the taxes will be lifted by the end of the year.

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“Certainly Canada wants them to go away, Mexico wants them to go away. I think generally speaking people in the U.S. would want them to go away,” Mr. Walker said.

For 2018, Magna said it expected North American light vehicle production to reach 17 million, down from an earlier estimate of 17.2 million. In Europe, auto makers will produce 22.5 million units, down from Magna’s previous estimate of 22.6 million.

As a result, Magna reduced the high end of its 2018 sales outlook to US$41.4-billion from US$42.5-billion.

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