Hella KGaA Hueck & Co. Business Report FY2008-09

Business Highlights

Financial Overview

(in million euros) FY2008-09 FY2007-08 Rate of
Sales 3,285 3,940 (16.6%)
Gross profit 755 925 (18.4%)
Result before tax on earnings 18 202 (91.1%)
Profit 7 143 (95.1%)

-The Company's sales declined 16.6 percent from 3,940 to 3,285 million euros in fiscal year 2008-09. The original equipment products of the business divisions Lighting and Electronics were hit particularly hard by the sudden drop in orders from vehicle manufacturers.


-The Company supplies high-beam assistant to the new E-Class from Mercedes-Benz. The system, which is available as an option, uses a camera on the windshield to detect oncoming vehicles or vehicles traveling in front, and controls the headlamps such that the light cone ends before the other vehicles. In the new E-Class, Mercedes-Benz offers the new system in a lighting pack together with Bi-Xenon headlamps, Intelligent Light System and LED daytime running light. (From a press release on May 6, 2009)

-The Company is providing General Motors' European 2009 Opel Insignia with a camera system that reads traffic signs. The optional camera is known as "Opel Eye". Its traffic sign detection system reads speed-limit signs, no passing signs and other traffic restriction markers and displays a symbol on the vehicle's dashboard. The Opel Eye is paired with Hella's Lane Departure Warning (LDW) system. (From a press release on Oct. 20, 2008)

-The Company will strengthen marketing of head lamp washer systems to Japanese automakers to win new orders. Installation of this system is expected to be mandatory in the first half of 2010's in Japan, to improve safety by preventing glare often caused by the dirty face of the lead lamp from obstructing oncoming vehicles. Appealing its experiences with more than half of the global share in this field, and the system's excellent cleaning performance during high speed driving when stable supply of cleaning fluid becomes difficult. Hella will also aim to market a lamp cleaning module combining a head lamp and a washer. The company is a leading manufacturer of head lamp washers producing 5 million units a year, having a 70% share in Europe where installation of the washer systems is already obligatory for some vehicle models. (From an article in the Nikkan Jidosha Shimbun on Jun. 30, 2008)

-The Company, seeking business expansion to Japanese automakers, will start a full-scale promotional campaign for the electric power control system that ensures fail-safe operations and comfort while an idle stop & go (ISG) system is in action. Its original ultra-small battery charge and discharge sensor and an electric power converter that rectifies electric voltage supplied to on-board electric equipment at the time of idle stops can eliminate the use of dual-channel batteries required for stable operation of the system. Emphasizing the advantages of the new power control system, which will contribute to reducing vehicle weight and costs as well as highlighting the ISG function, the Company is seeking to absorb needs of automakers striving to improve fuel efficiency. (From an article in the Nikkan Jidosha Shimbun on Jun. 4, 2008)


-Hella Hongfa (Xiamen) Automotive Electronics Co. Ltd. (HAE) of China has become a wholly-owned subsidiary of Hella. Hella recently acquired the 30 percent share held in HAE by former joint-venture partner Xiamen Hongfa Electroacoustic Co. Ltd. HAE was established in 2003 to develop and produce automotive relays. (From a press release on Feb. 23, 2009)

-The Company and Mando Corporation of Korea have signed an agreement to establish Mando-Hella Electronics Corp., a 50-50 joint-venture company to manufacture driver assistance systems in Korea. Mando-Hella Electronics will be capitalized at 65 billion won. The construction project is scheduled to begin in early 2009 and end by July the same year. The new facility will produce driver assistance systems such as adaptive cruise control (ACC) systems, intelligent parking assistance (IPA) systems, and lane keeping assistance (LKA) systems. (From a press release on Oct. 17, 2008)


R&D Structure

-The main focus of R&D activities has been on LED technology for headlamps, light-based driver assistance systems, energy management and selected electronics components.

-In the fiscal year 2008-09, the number of employees in R&D declined by 7.5% to 3,262 (previous year 3,528 employees). This corresponds to a quota of 14.3% of total staff.

R&D Expenditure

(in million euros) FY2008-09 FY2007-08 FY2006-07
Employees 3,262 3,528 3,117
R&D Expenditure
-Lighting technology 120.3 125.9 119.3
-Electronics 169.4 169.5 145.3
-Aftermarket products 15.9 14.6 20.2
Total 305.6 310.0 284.8
as a % of sales 9.3% 7.9% 7.8%
In the fiscal year 2007-08, 310 million euros, or 7.9% of the Company's sales, were invested in R&D.

R&D Developments

-The Company concluded the development of the first full-LED headlamp in the world for a high-end SUV and started large-scale series produciton of this headlamp in summer 2008.

-Together with Audi, the Company has developed a lane change assistant for the new Audi A4. When changing lanes, it considerably reduces the danger of overlooking vehicles approaching from the rear. The system assists the driver via permanent monitoring of the adjacent lanes from a speed of 30 km/h, and warns in the event of passing and lane-change procedures if a vehicle has been detected in the adjacent lane. Critical situations are indicated via an optical warning in the side mirror. Two 24-GHz radar sensors on both sides, which have a range of fifty meters, detect other road-users in the rear and side area of one''s own vehicle, as well as objects located in the blind spot. They work largely irrespectively of weather conditions. Various European and Asian vehicle makers now use the lane change assistant from Hella in series production. It can already be found in six different series, more will follow. (From a press release on Mar. 28, 2008)

Investment Activities


-The Company will open the first electronics plant in Mexico. The facility will manufacture transmission range and pedal sensors, as well as vacuum and washer pumps for the company's Asian- and North American-based OEM customers. (From a press release on Oct. 23, 2008)

-Behr-Hella Thermocontrol (BHTC) has opened a new development and marketing facility in Tokyo: Officially established at the end of 2007, BHTC Japan K.K. commenced full operation in 2008. BHTC Japan will start life as a centre for sales and technical support for Japanese automotive manufacturers, gradually developing into a development centre. (From a press release on Jul. 31, 2008)