Rheinmetall Automotive AG (Formerly KSPG AG) Business Report FY ended Dec. 2018

Financial Overview

(in million EUR)
FY ended Dec. 31, 2018 FY ended Dec. 31, 2017 Rate of Change
Rheinmetall Automotive
Net Sales 2,930 2,861 2.4
EBIT 262 249 5.2
Sales by segment
Mechatronics 1,664 1,621 2.7 1)
Hardparts 989 968 2.2 2)

1) Mechatronics
-Sales of the Mechatronics division rose owing to a further increase in demand from automotive manufacturers for solutions to reduce fuel consumption and emissions as well as further growth in business with commercial vehicles.

2) Hardparts
-The Hardparts division recorded growth largely owing to the positive development of business with large-bore pistons and pistons for trucks and off-road vehicles.



<Newest piston designed to fulfill the NS 5 and 6 standards>
-KS Kolbenschmidt GmbH will produce newest piston technology designed to fulfill the NS 5 and 6 standards through its Chinese licensee ZNKS (ZYNP Group). ZNKS has built a production plant in Mengzhou, China. KS Kolbenschmidt is supplying the sophisticated equipment along with ultramodern technologies for the areas of pre-machining, friction welding, and finishing. (From a press release on December 10, 2018)

<Coolant valves>
-The Company has been awarded its first orders from Chinese customers for the current generation of coolant valves. They have placed orders worth EUR 25 million with Pierburg GmbH. With startup of production scheduled for 2019 and 2020, the coolant valves will be installed in various models of the auto brands including SUVs, which are of growing popularity in China. The orders are for 2-way coolant valves each with two switching states for interior heaters in cars powered by 1.0- and 1.5-l turbocharged engines as well as 3-way valves for temperature control of the battery in electric vehicles. The valves will be manufactured in Pierburg's Chinese plant in Kunshan for shipment to the OEMs' production plants in China and the USA. (From a press release on November 6, 2018)

<CWA 400 electrically powered pump>
-Large-scale orders for its CWA 400 electrically powered pump. The orders, placed with Pierburg Pump Technology GmbH represent a volume totalling EUR 215 million. The transaction involves on the one hand the extension of an existing contract, and on the other the launch of a new engine project. Production of the electric coolant pumps will take place in Hartha in the German state of Saxony. They will be used for the main coolant circuit of four-cylinder engines with two-litre cubic capacity in European and Chinese vehicle models. The pumps will be shipped to one of the customer’s plants in Europe as well as to several of its factories in China. The variable-flow electric coolant pumps enable on-demand control of the coolant flow. Depending on ambient temperature and engine load, this can result in fuel savings of up to four percent. A version of the pump is also available for 48-volt electrical systems. (From a press release on October 30, 2018)

<Aluminum pistons for a six-cylinder gasoline engine>
-Booked additional orders in various product segments with a total value of around EUR 200 million. The Company is delivering aluminum pistons for a six-cylinder gasoline engine. It is produced at Usti nad Labem, Czech Republic. For a three-cylinder gasoline engine, Rheinmetall Chinese joint venture KSHP (Kolbenschmidt Huayu Piston) is the sole supplier of pistons worth a total of over EUR 30 million. Group-affiliate KS Gleitlager GmbH was recently awarded a contract for components of a four-cylinder diesel unit. The affiliate will as from 2020 be supplying the main and connecting-rod bearings as well as thrust washers. Pierburg GmbH will produce divert-air valves worth a total EUR 7 million at the German Lower Rhine plant for installation in a six-cylinder gasoline engine. Pierburg Mikuni Pump Technology will launch series production of a recirculating-water pump with a lifetime sales volume of over EUR 5 million. (From a press release on April 25, 2018)

<Pistons featuring the latest Liteks 4 technology>
-KS Kolbenschmidt, a subsidiary of the Company, has just been awarded its first contract for pistons featuring the latest Liteks 4 technology. The order has a lifetime value of over EUR 47 million. The customer is a joint venture between a major international automaker and a leading group of companies in China. The components are destined for a new 4-cylinder gas engine with 1.5-liter displacement and an output of almost 150 kilowatts. Production scheduled to start in autumn 2021. The lightweight pistons will be manufactured at the newly built piston plant in Chongqing, which belongs to the Group’s Chinese joint venture company Kolbenschmidt Huayu Piston (KSHP). The piston rings are sourced from Kolbenschmidt’s alliance partner Riken, and will be shipped out to the OEM fully assembled. Production of the piston rings will take place at the Kolbenschmidt/Riken joint venture plant in Wuhan. (From a press release on March 22, 2018)

<Coolant pumps for Karma Automotive in Southern California>
-Pierburg subsidiary received an order from the Southern California vehicle maker, Karma Automotive, to supply coolant pumps for its Revero plug-in electric hybrid vehicle (PHEV), which is sold in the U.S. and Canada. The coolant pumps will be delivered in a smaller version (CWA 50, 50 watts) and a larger one (CWA 100, 100 watts). The coolant pumps are being manufactured at Pierburg's location in Hartha, Germany. Pierburg’s pumps are used for a variety of functions, from cooling the charge air on turbochargers to the main coolant circuit on internal combustion engines. In hybrid and electric vehicles, the pumps handle such functions as cooling or temperature-control of electric drivelines, batteries, DC-DC converters, and power electronics. (From a press release on January 30, 2018)

R&D Expenditure

(in million EUR)
FY ended Dec. 31, 2018 FY ended Dec. 31, 2017 FY ended Dec. 31, 2016
Total 193 186 142


R&D Activities

<Robust polymer-coated material for crankshaft main bearings>
-KS Gleitlager GmbH offers a complete product folio for commercial vehicle engines. The new polymer bearing R53L1 has been further developed from the first generation of its kind and is based on the proven R53 steel-aluminum material as a lining for the polymer layer. This substrate, already well proven, enhances bearing robustness through its outstanding dirt tolerance, in all offering improved wear resistance with no compromise on robustness. Another advantage of the new bearing is its very low friction coefficient in mixed friction conditions. This is due to the proven solid lubricants MoS2 and graphite, already a feature of the first polymer generation. Hence, the material has a very low coefficient of friction even for polymer bearings. (From a press release on December 14, 2018)


Product Development

<Refrigerant system (thermo module)>
-It eases driveline electrification and addresses both traditional commercial vehicle manufacturers and industry start-ups with lean development facilities. As a complete package, it can be integrated into both new and existing vehicle platforms. The thermo module is made up of a heat pump and periphery of proven Pierburg components such as solenoid valves and pumps. As a proactive thermal management unit for the entire vehicle it performs such essential functions as precise temperature control for the battery and power electronics (cooling/heating) through a connected coolant circuit of water and glycol. The module also takes care of interior air conditioning and temperature control for the electric driveline components, including the electric motor. (From a press release on December 3, 2018)

<Zero-lead plain bearing family>
-New, zero-lead and hence eco-friendly plain bearing family KS P240, KS P241, KS P242 and KS P243, which are used in commercial vehicles, delivers clear benefits in terms of friction and wear as well as zero maintenance, especially in situations involving oscillating rotation and high static/dynamic loads. The plain bearing shells and bushings from KS Gleitlager serve a multitude of applications on commercial vehicles of all kinds, both inside and outside the engine – for example, connecting rod and main crankshaft bearings. Others can be found on the vehicle chassis, in mechanical linkages, compressors, or hydraulic components. Permaglide bearing elements from KS Gleitlager, especially when used in system applications in commercial vehicles, stand for cost effectiveness, dependability, and longevity. (From a press release on November 28, 2018)

<High-precision motorized back-pressure valve (BPV)>
-With a view to continuously rising technical requirements, the newest product generation has a double-wall welded housing for protecting the actuators and neighboring components from overheating. This reduces the cost of the more expensive option of thermal insulation to a minimum. The valve can be combined to form a low-cost system and thus fulfill such tasks as assisting in EGR or thermal management for SCR and diesel particle filter regeneration. Other functions include engine-assisted braking for reduced wear on the primary brake system, or gear-shift assistance for automatic transmissions. (From a press release on November 20, 2018)

<Solenoid valve>
-Solenoid valve that shuts off the oil cooling of the pistons when needed. It has already gone into series production. Piston cooling is usually effected by nozzles spraying the oil flow from the engine oil pump into an interior coolant passage of the piston to allow any excess heat to be dissipated. When the new solenoid valve is switched on, the flow of oil leading to the nozzles is interrupted.The new solenoid valve has been developed on the basis of already existing valves for controlling variable oil pumps and is small and lightweight thanks to simulation-aided actuator design and optimized flow geometries. It can therefore be mounted at various points, for example, in the housing of the oil filter module or in the engine block. (From a press release on April 5, 2018)

<Secondary air blower with speed-controlled motor>
-Pierburg developed the associated secondary air blower and provided it with a speed-controlled motor. The latter allows secondary air injection across a much wider engine map range and hence, at any given point in time, the precise air mass required for accelerating converter heat-up is injected into the exhaust system. Through the secondary air pump, the new air blower not only accelerates catalytic converter heat-up, it lowers electric energy consumption and emissions. It thus helps many engines to comply with such standards as EU 6.2, RDE, SULEV 20 or Beijing 6. (From a press release on March 13, 2018)

<Newly engineered wastegate actuator>
-It allows direct activation of the wastegate valve by being mounted on the hot turbine housing. Thermal insulation from the housing combined with efficient temperature control of the coolant prevent actuator overheating under all operating conditions. Additionally, the 12-V DC motor is cooled to such a degree that motor load can be stepped up with the advantages of a lower gear ratio between motor and actuator shaft and a higher actuating torque. For system validation, prototypes were produced and tested on the company's test benches over 500 operating hours on a new gasoline engine shortly to go into series production. (From a press release on March 6, 2018)

<New in-line valve as part of a modular system>
-The new valve features compact design cuts out the normal shaft displacement between the input and output lines. This means the actuator requires no space outside of the coolant pipes, and hence the packaging within the vehicle is much more compact. Lower pressure losses allow reduced energy consumption by the pumps as well as significantly higher flow rates. Rounding off the new valve technology is a weight reduction of over 30 percent compared to conventional valves. (From a press release on February 27, 2018)

Capital Expenditure

(in million EUR)
 Rheinmetall Automotive FY ended Dec. 31, 2018 FY ended Dec. 31, 2017 FY ended Dec. 31, 2016
Total 161 154 149


Investments outside Germany

-The Company has opened yet another production location in China with joint venture partner HUAYU Automotive Systems (HASCO). Around 16,000 square meters, the new plant of HASCO KSPG (Guangde) Nonferrous Components Co. Ltd. is situated in Guangde, northwest of Shanghai. The plant will be the first within the joint ventures to use the sophisticated and premium-grade low-pressure casting technique for the production of electric housings for electric vehicles. The new Guangde plant will increase its workforce to 450 by the end of 2018. Initially, the plant will generate sales of RMB 560 million. Over the next five years, annual cylinder head production is scheduled to almost double. (From a press release on December 18, 2018)