Starting in 2016, ZF will combine all electromobility-related activities in a new e-mobility division, based at the company's Schweinfurt location, the supplier has announced. It is also moving shock absorber production out of Germany.

By combining all activities associated with the electrification of cars and commercial vehicles under one roof, we are acknowledging the enormous importance of these advanced technologies, which are already shaping the future," said CEO Stefan Sommer. "Electromobility is coming – and in view of current controversies over car emissions, perhaps even sooner than we first thought." Just how seriously ZF is taking the step-by-step migration from conventional driveline technology to electromobility is clearly reflected, Sommer suggested, by the addition of a new E-Mobility division to the corporate structure.

Previously, all activities associated with the growth business of electromobility were distributed across multiple organisational units. Now all have been consolidated in the new division which complements four existing divisions – car powertrain technology, car chassis technology, commercial vehicle technology and industrial technology – as well as the newly created active & passive safety technology division, which incorporates all the business activities of (recently merged former rival) TRW.

The company's existing electronic systems and electric drive technology business units will form the core of the new e-mobility division. They will be joined by the 'E-Mobility Project House' which will bring together electromobility projects from across the entire company.

Schweinfurt now hosts both the e-mobility division and ZF's lightweight design activities.

"With our new division, we'll be able to participate in the global trend toward electrified drivelines and offer our customers the products and systems they need to comply with increasingly stringent international regulations," said Sommer. "At the same time, we are transforming our Schweinfurt plant from a production facility specialising in the manufacture of chassis components into one that builds more technically sophisticated driveline components. This will help secure the location's long-term future."

Shocks to move from Germany

To date, shock absorber production has been located at the company's Schweinfurt, Eitorf and Ahrweiler sites in Germany. ZF has now developed a 'master plan for shock-absorber production' to counter the "enormous cost pressures impacting conventional shock absorbers in particular". Because it is no longer possible to manufacture them at competitive prices in Germany – a high-wage country – production is being moved abroad, away from Schweinfurt, Eitorf and Ahrweiler. Most of it will be handled by ZF's existing production facilities in Levice (Slovakia) and Gebze (Turkey), the supplier said.

The latest generation of electronically controlled shock absorbers is based on more sophisticated technology so some production of these and other products will be relocated from Schweinfurt to Eitorf, Ahrweiler and other facilities in Eastern Europe. This will enable ZF to safeguard jobs in Eitorf and Ahrweiler until at least the end of 2022. Schweinfurt, which is gradually relinquishing all shock-absorber production, will instead house the new e-mobility division.

"Investing in the future requires strict discipline elsewhere," said ZF production head Michael Hankel. "This is why we continue to systematically pursue a policy of relocating products which have reached the end of their product lifecycle – that is, ceased to be innovative, high-tech products and become standard products – from Germany to locations with lower production costs abroad."

Hankel added "if we want to remain competitive across all product segments, we must obey the rules of the open market even more rigorously."

Over the last few months, ZF has negotiated the shocks master plan, as well as the details involved in establishing the e-mobility division in Schweinfurt, with the works councils at the various locations affected.

"Firstly, it will enable us to manufacture our products at competitive prices, and secondly, it will allow us to preserve our Eitorf and Ahrweiler facilities, which between them currently employ around 900 people," added Hankel.