Brose Fahrzeugteile GmbH & Co. KG Business Report FY ended Dec. 2018
Financial Overview |
(in million EUR) |
| FY ended Dec. 31, 2018 | FY ended Dec. 31, 2017 | Rate of change (%) | Factors | |
| Net Sales | 6,537 | 6,311 | 3.6 | 1) |
Factors
1) Net Sales
-The Company’s sales in the fiscal year ended December 31, 2018 increased by 3.6% to EUR 6,537 million. Sales in the Company’s Door and Electric Motors and Drives business division increased, while sales in its Seat Structures business division decreased from the previous year.
Joint Ventures
-The Company and AUNDE announced a joint venture for the development, assembly and delivery of complete seats for passenger cars. Both partners will each own 50% of the joint venture. The joint venture is expected to begin operations in early 2019 and operate independently in the international market. The joint venture will build sites and manufacturing capacity based on customer projects. The foundation is subject to antitrust approval by the EU. The Company and AUNDE complement each other in their knowledge and product portfolio. As the mechatronics specialist, the Company contributes its strengths as a leading supplier of adjustable seat structures, comfort components and electronics. AUNDE brings together expertise in all aspects of foam, covers, trim parts and comprehensive experience in assembly and logistics as a supplier of complete seats for light and heavy commercial vehicles. (From a press release on December 18, 2018)
Recent Developments
-The Company has invested in AIM3D, a company which develops new processes for additive manufacturing. Based in Rostock, AIM3D has developed a new additive manufacturing process. For the first time, typical materials used in automotive series production can be processed in 3D printing. Thus, prototypes can be produced faster, which significantly accelerates the development of new products and reduces costs. (From a press release on November 8, 2018)
-Mexico’s first automotive university recently opened inside of the Polytechnic University of Queretaro in Mexico. The educational facility will be a part of that institution’s Center for Innovation and Automotive Development (CIDEA) and will be operated by the Company. In his announcement of the opening of the Center, the governor of the State of Queretaro, Francisco Dominguez Servien, noted a total investment of approximately USD 15 million for the construction of the facility and the purchase of equipment. (From a Mexico-Now article on April 2, 2018)
Contracts
-The Company is supplying seating systems, window regulator motors and locking systems to the London EV company LEVC. The systems that are being used in the driver's seat have previously been installed on Volvo models, a sister brand of the company. The products are developed in Coburg. In addition to the seat structures, the Company also supplies locks and window regulator motors for the new TX model. (From a press release on July 12, 2018)
Outlook
-In the fiscal year ending December 31, 2019, the Company expects to have net sales of EUR 6,614 million. The Company also expects to have sales of EUR 9.5 billion by 2025.
R&D Expenditure
-The Company aims to invest approximately 8% of its sales in research and development each year.
Technological Alliance
-The Company and Plastic Omnium announced the launch of an innovative co-development project on automotive side doors. The collaboration, involving engineering and design experts from both companies working in a newly established technical office in Nuremberg, Germany, consists in jointly developing new hybrid door systems to anticipate future needs. Plastic Omnium will provide its technological expertise in body panels, crash and system design for car exterior while the Company contributes its innovative solutions in the field of mechatronics and door systems. (From a press release on December 12, 2018)
Product Development
Lightweighting of various products
-The Company announced that it is bringing an electric drive for the automatic opening and closing of side doors to series maturity, enabling easier access to the vehicle. With innovative materials, the Company has significantly reduced the weight of the electric drive and its other products. Through the use of plastic, the window regulator is almost 500 grams lighter than a variant made of steel. In the case of door systems, the Company saves up to five kilograms of weight per vehicle thanks to glass-fiber-reinforced thermoplastic compared to conventional steel doors, while also improving quality and function. (From a press release on December 7, 2018)
General expansion of product portfolio
-As part of the Company’s efforts into expanding its product portfolio, its research and development efforts have focused on systems including electric air conditioning compressors, complete seat systems, mechatronic systems for interiors and vehicle access systems.
Capital Expenditures |
(in million EUR) |
| FY ended Dec. 31, 2018 | FY ended Dec. 31, 2017 | FY ended Dec. 31, 2016 | |
| Overall | 433 | 409 | 380 |
-The Company expects to invest approximately EUR 540 million in capital expenditures in the fiscal year ending December 31, 2019. In addition, the Company has launched a EUR 1.5 billion investment program for 2019 through 2021 in new products, technical equipment and its locations across the world. The EUR 1.5 billion investment will be used for projects including a new production facility in China, expansion at the Company’s existing locations in Coburg, Bamberg, and Wuerzburg, Germany, and another phase of construction at the Company’s facility in Prievidza, Slovakia. The Company is also looking to hire additional employees in the fields of product development, electronics, sensor technology and IT.
-Investments which the Company made in 2018 were directed into projects including the inauguration of a plant in Taicang, China; increased production in Queretaro Aeropuerto, Mexico; and expansions in Prievidza, Slovakia and Tuscaloosa, Alabama, U.S.
Investments outside Germany
<China>
-In December, the Company opened a new plant in Taicang, China. Primarily for the Chinese market, the plant will produce its entire portfolio, including door systems, seat structures and motors there. Brose Taicang will be the Company’s largest production facility in Asia. The Company is investing EUR 180 million into the plant, which will employ 1,600 people by 2024. The plant features a modern production control system, which analyzes data from production and controls the entire manufacturing process, thus increasing product quality and minimizing scrap. Brose Taicang will grow to a total area of 73,000 square meters with the completion of the second phase of construction at the end of 2019. (From a press release on December 19, 2018)