ZF says meeting extremely tough new CO2 emissions targets set by the European Commission (EC) will be a tall order, but remains confident it can help the auto industry achieve the reductions imposed by Brussels.
The EC struck a deal with its Member States that mandates a 37.5% average CO2 reduction compared to today for cars by 2030 and 31% for vans – a move the ACEA warned would have a “seismic impact” on jobs across the value chain – but ZF struck a more upbeat note.
Go deeper with GlobalData
“If someone asked me – 37.5% – I would not have believed it,” ZF CEO, Wolf-Henning Scheider told just-auto in the German supplier’s home-town of Friedrichshafen where it unveiled 6% organic growth in sales to EUR36.9bn.
“Do I regret it? We will just look ahead. It is a fact now and we will adapt to the situation. It is going to be a major challenge for the entire industry, but I can see with the battery electric vehicles and plug-in hybrids, we have already good solutions we can offer. Yes, it is a major challenge, but I think our team will succeed in meeting it.”
The ZF chief made his comments following those of ACEA, which said it was concerned about the competitive implications for Europe’s auto industry if faced with CO2 emission targets which are much tighter than elsewhere in the world.
The strict new rules add to the pressure currently being felt by the industry, which is being squeezed by a falling Chinese market in particular and economic headwinds in Europe, where Germany only narrowly escaped falling into recession during the last quarter.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData“We have a new approach for our company and have reduced complexity,” added Scheider. “It is not just measures to save costs – it is to speed up – the aim is to be faster. We are convinced a company with 150,000 employees can’t just be realigned – we have to focus on certain areas.
“The last two months of 2018 were considerably weaker – in particular the Chinese market [where] we had weak results. This year will be difficult for the automotive industry – in 2018 the market has already declined. We expect [it] to decline further, China again with a difficult year ahead. The first two months [2019] were double digit negative figures so we are experiencing -3% to -4% through the year – the market is under pressure [while] in Europe we have a cool down.
“In North America we have a decline because the tax effective two years ago is no longer effective. It is not going to be an easy year. We will have to concentrate on our operations to keep our results in focus. Our forecast is flat growth – EUR37bn – EUR38bn sales.”
Despite the economic challenges facing manufacturing, ZF was nonetheless buoyed this week by news it had secured a supply contract with BMW for its enhanced 8-speed automatic transmission including a hybrid variant.
The long-term contract – for an undisclosed sum – represents says ZF the largest order of a automatic transmissions in the history of the company.
