ZF on Target for 2023; Corporate Changes
Jun 11, 2023
FRIEDRICHSHAFEN, Germany — In the first six months of 2023, ZF generated sales of €23.3 billion (2022: €21.2 billion), an increase of approximately 10 percent on the prior-year period.
Adjusted EBIT totaled €941 million (2022: €851 million), equivalent to an adjusted EBIT margin of 4.0 percent (2022: 4.0 percent).
“The economic environment in the first half of 2023 was difficult again and characterized by many uncertainties,” said ZF Chief Financial Officer Michael Frick when presenting the half-year figures on Wednesday, Aug. 2nd. “High inflation and the consequences of the ongoing war in Ukraine are some of the challenges that ZF and the entire automotive industry continue to face.
“Moreover, uncertainty surrounding the development of world markets affects the entire economy. Against this background, it is even more important to industrialize our strategically important future products and bring them to the operational business. So, they can provide corresponding value to our earnings.”
From January through June 2023, the technology company generated sales of €23.3 billion (2022: €21.2 billion), representing an increase of 10 percent (up 11 percent when adjusted for currency and M&A effects) on the prior-year period. The company reported an adjusted EBIT of €941 million (2022: €851 million).
“In a challenging market environment, we have asserted our performance with figures within our expectations. Despite high inflation and higher R&D expenditure, we were able to achieve our earnings target,” added Frick. “Although we are not yet satisfied with the financial results and the next six months will not be easy, we are confident that we will meet our annual targets presented at the beginning of the year. We confirm our full-year outlook, as we continue to follow the measures presented around the same time.“
We will achieve our annual targets by further reducing our costs, mitigating inflationary effects through cooperative talks with customers and optimizing our inventories. I would like to thank ZF employees for their commitment, which made this result possible in a difficult environment.”
Based on its Next Generation Mobility strategy, the technology company is further developing its corporate structures to adapt them even better to market requirements. To this end, ZF has entered a 50:50 partnership for passenger car chassis systems with Hon Hai Technology Group (Foxconn), the world’s largest electronics manufacturer. The objective of the strategic partnership is to develop the passenger car axle systems assembly business unit – bundled in ZF Chassis Modules GmbH – and tap into new customer groups.
Based on the Next Generation Mobility strategy, ZF is merging the Car Chassis Technology and Active Safety Systems Divisions into a new division for chassis, steering and brake technology that is unique in the market.
The new Chassis Solutions Division offers the full range of hardware, software and electronics to master the vertical, longitudinal and transverse dynamics of a vehicle. With sales of more than €14 billion, it will be a strong partner for ZF’s customers. The new division will launch on January 1, 2024, and will be headed by Dr. Peter Holdmann.
ZF is also independently establishing the Passive Safety Systems Division so that the business unit can grow faster and operate more successfully in the market.
“If there is particular interest in this attractive segment with excellent growth perspectives, we will talk to potential partners about entering as external investors,” explained Frick. “We are keeping all options open and are aiming for a timeframe that is favorable for the capital market regarding a possible transaction.”
As planned, ZF is making progress with the carve-out of the shuttles business unit, which was announced last year and is now ongoing. The business with autonomous shuttles and the associated system technology, spread over several units, is particularly capital-intensive. That is why ZF is bundling it into an independent unit to become attractive to external investors.
To view the entire announcement, click HERE.
The BRAKE Report is an online media platform dedicated to the automotive and commercial vehicle brake segments. Our mission is to provide the global brake community with the latest news & headlines from around the industry.