in millions of euro )
of change (%)
||See note 1) below.
|Sales by segment (Automotive
|Car Driveline Technology
||See note 2) below.
|Car Chassis Technology
||See note 3) below.
|Commercial Vehicle and Special Driveline
||See note 4) below.
|Off-Road Driveline Technology and
||See note 5) below.
|Powertrain and Suspension Components
||See note 6) below.
||See note 7) below.
|Steering Technology (ZF Lenksysteme
||See note 8) below.
Sales distribution by sectors, Consolidated
|Cars and light commercial
vehicles < 6 t
vehicles > 6 t
Agricultural, Marine, Aircraft etc)
1) Sales of Overall
In the year 2006, the Consolidated ZF Group increased sales
by 8 % to euro 11,659 million. Thus, the Company again grew
more dynamically than the market. In the core business of
driveline and chassis technology products for passenger cars
and commercial vehicles, which represents 87 % of its sales,
the Company further strengthened the international market
position. The most successful products for passenger cars
include automatic 6-speed transmissions, axle drives, electronic
damping systems, axle systems, and electric power steering
systems. In the field of commercial vehicles, automatic transmission
systems, low-floor axles for buses, steering systems, as well
as driveline and chassis components were successful. The respective
divisions and business units benefited from the favorable
trend in the industry, particularly in the fields of commercial
vehicles and construction machinery.
The sales percentage in construction and agricultural machinery,
marine craft, aircraft, as well as special and rail vehicles
remained unchanged at 13 % in the year 2006.
2) Car Driveline Technology
- Compared with the prior year, this division increased sales
again by 3 % to euro 1,979 million. All in all, approx. 1.3
million passenger car transmissions were produced. The ZF
Getriebe GmbH, Saarbrucken plant, sold approx. 1,029,000 automatic
transmissions 窶 an increase of 4 %. Sales rose accordingly
to euro 1,720 million. Automatic 6-speed transmissions comprise
over 95 % of total production.
Compared to the prior year, the plant in Brandenburg recorded
2 % growth with the supply of 262,000 manual transmissions.
Sales totaled euro 258 million.
- The new plant in Shanghai, ZF Transmissions (Shanghai) Co.
Ltd., for production of automatic transmissions was officially
opened in the fall of 2006.
In June 2006, the Company began
volume production of Automatic 5-speed transmission for the
VW Passat Lingyu.
-The new generation of automatic 6 speed transmissions for
passenger cars began volume production.
Thanks to the new transmissions, gasoline engines use up to
3 % less fuel and diesel engines up to 6 % less. At the same
time, the transmissions reduce acceleration times, and shift
times were shortened by 50 %. These transmissions have been
offered by BMW in the new 3 Series Coupe and the X3 since
September 2006, with additional models to follow.
- Effective July 1, 2006, ZF Getriebe N.V. was acquired by
Punch International NV, a diversified
technology group headquartered in Sint-Martens-Latem/Belgium.
will continue the present activities in Sint-Truiden, and
it intends to continue
development of continuously variable transmissions.
3) Car Chassis Technology
- In the year 2006, sales in this division increased by 12
% to euro 2,329 million despite the continuously very difficult
- New production plants which met and/or exceeded planned
production volumes in the year 2006 were major factors in
the growth of sales. These plants include ZF Fawer Chassis
Technology (Changchun) Co. Ltd. China with the assembly of
front and rear axle systems for Audi, ZF Lemforder (Thailand)
Co. Ltd. Thailand with axle assembly for BMW, and ZF Lemforder
Australia Pty. Ltd., Australia, with the production of axle
systems for the customer GM Holden. ZF Lemforder Corporation
in Tuscaloosa, USA, completed the conversion of production
for the current Mercedes M-Class as well as the R and GL models.
Only ZF Lemforder Chicago LLC, USA lagged considerably behind
planning after a customer reduced supply volumes.
4) Commercial Vehicle and Special Driveline Technology
- Within the commercial vehicle industry, which developed
better than expected, the division took advantage of its strong
market position and product innovations to again achieve growth.
Sales increased by 8 % to euro 1,776 million.
-The Truck Driveline Technology business unit achieved sales
of euro 1,236 million, which reflects an increase of 12 %
and is considerably above the overall development of the market
in the truck sector. In Western Europe, market share expanded
to 45 %. In Russia and China, both the joint venture OOO ZF
Kama in Russia and the subsidiary ZF Drivetech (Hangzhou)
Co. Ltd. in China developed positively.
- In 2006, the Bus Driveline Technology business unit registered
sales of euro 330 million. This represents a growth of 2 %
on a consolidated basis. The leading market position in bus
transmissions was maintained and even expanded in some markets
and regions. Successes in the coach business in South Korea
are noteworthy, where new customers were acquired for manual
transmissions and ZF-Intarder secondary retarders. Business
with Chinese bus manufacturers was entered successfully with
the Ecomat automatic transmission; in addition
to China, Southeast Asia and the Middle East are the primary
target markets. At ZF Drivetech (Suzhou) Co. Ltd., China,
manufacturing of components for local assembly of manual 6-speed
transmissions was advanced. The new EcoLife automatic transmission
was presented at the IAA Commercial Vehicles in Hanover, Germany.
The first application of this transmission was launched in
the new Volvo B9TL double-decker bus.
- Despite the continuously difficult market environment in
North America, the Pickup/Van Driveline Technology business
unit increased sales by 12 % to euro 133 million. This development
was driven especially by the European market, where the customer
base was expanded with the volume production launch of transmissions
for the Nissan Cabstar and Nissan Atleon.
- The Special Driveline Technology business unit, which includes
the military vehicles, special vehicles for civil purposes,
rail vehicles, and industrial drives product segments, achieved
sales of euro 142 million in the year 2006, which represents
an increase of 12 %.
5) Off-Road Driveline Technology and Axle Systems
- In the year 2006, the division achieved sales of euro 1,692
million, a 20 % increase compared to the prior year. This
development benefited from the healthy economic situation
of commercial vehicles and construction machinery. However,
new business also contributed to the strong sales growth.
- With only moderate growth in the bus sector in the core
market of Europe, the business unit of Commercial Vehicle
Axle Systems increased sales by 21 % to euro 193 million.
The most important contributor to growth was primarily the
sales success in new markets such as China and South America
with lowfloor axle systems for Bus Rapid Transit. Initial
production orders were received in Russia and Ukraine. The
transfer case all-wheel drive technology for the heavy trucks
product group achieved very favorable results with over 14
% sales growth.
- The business unit of Commercial Vehicle Chassis Modules
increased sales by 16 % to euro 266 million. Further gains
are achieved by an increase in the area of chassis suspensions
and cabin suspensions. A new plant was constructed in Shanghai
to keep pace with the strong growth in Asia. In South Korea,
the business unit successfully entered into the market by
supplying deliveries to a major customer.
- The business unit of Passenger Car Axle Drives increased
sales once again double-digit by 44 % to euro 341 million.
The volume production launch of a new rear axle drive in the
USA as well as the volume production launch of the rear and
front axle drives for Audi played a considerable role in this
success. In Thyrnau, 1.1 million ground bevel gear drives
were produced, which makes the location number one worldwide
for ground bevel gear drives.
6) Powertrain and Suspension Components
- The division achieved sales of euro 2,125 million in the
year 2006, reflecting 5 % growth. Business volumes increased
equally in Germany and abroad, whereby a shift from conventional
to more technologically advanced products was observed. Business
development in the NAFTA region was inconsistent. The declining
production figures at some manufacturers could not be completely
offset. Sales in Asia rose due to the recovery of market shares
of main customers in China. In addition, projects to increase
efficiency and acquire new Asian customers showed positive
- The Powertrain Components business unit recorded an increase
in sales of 5 % to euro 1,046 million. In the passenger car
sector, demand for dual-mass flywheels and wear compensating
clutches again exceeded the prior year's already high figures.
Intense development efforts with European customers for electric
drives for systems were successfully advanced in both the
passenger car and the light commercial vehicle sectors.
Furthermore, volume production of a newly developed, strategy-compatible
wet starting element as a supplement to the torque converter
was pushed forward. Volume production began on a new generation
of torque converters with outstanding properties in the area
of torsional vibration decoupling, which has been received
positively on the market. During the entire year 2006, the
business unit profited from strong commercial vehicle business.
Volume production of the integrated pneumatic clutch control
system for heavy commercial vehicles (ConAct), in addition
to the clutch and dual-mass flywheel systems, is successful.
An air compressor clutch and a belt drive damper for commercial
vehicles were developed, leading to a sustainable reduction
in fuel consumption.
- Despite continuously difficult conditions, the Suspension
Components business unit recorded an increase in sales of
3 % to euro 1,219 million. Sales increases in all product
segments, except for the Nivomat suspension level regulating
system, contributed to the positive figures. In particular,
sales of the electronic damping system CDC (Continuous Damping
Control) rose considerably. New sport utility vehicles market
segments were opened and other new projects for mid-size and
upper class models are in planning. In the passenger car sector,
the amplitude-selective damping will be introduced as standard
in the lower mid-size class for the first time in the year
7) Rubber-Metal Technology
- In the year 2006, business unit sales fell by 4 % to euro
515 million. This resulted
from exchange rate effects as well as the sale of Sun Manufacturing
& Coatings LLC, Williamstown, Kentucky/USA.
8) ZF Lenksysteme GmbH
- In the year 2006, sales outperformed the industry's average
again, increasing by over 5 % to euro 2,349 million compared
with the prior year. 50 % of sales are consolidated in the
Consolidated Financial Statements of ZF Friedrichshafen AG.
- Sales were divided between the business units as follows:
||Car Steering Columns
|| Commercial Vehicle Steering
Systems and Columns
- The strongest sales drivers were
the foreign companies, particularly in China, as well as the Servolectric
electric power steering system for passenger cars. In the year 2006,
the 4 millionth unit was manufactured since volume production launch
in the year 2002, making ZF Lenksysteme GmbH the world market leader
in the compact car sector. Sales of hydraulic steering systems remained
stable. Commercial vehicle steering systems also developed well, particularly
in Europe, and maintained the high level of the prior year.
< Outlook for FY2007>
-In 2007, a decline in growth dynamics is anticipated in the Company's
core sectors, in comparison with the maily positive year 2006.
- In order to grow in the long term and to secure high investments in
new product generations by larger volumes, the Company must acquire
new customers in addition to already established customers. The global
market presence must be expanded in order to participate in the growth
of the emerging markets. Intensified activities in the regions are necessary
to achieve this goal. In particular, product strategy must include design-to-market
approaches more intensely and therefore customer expectations that vary
throughout the regions. Furthermore, the Company will increase efforts
toward the important Japanese and South Korean vehicle manufacturers,
primarily by increasing development and sales activities.
In order to further expand the international market position and strengthen
competitiveness, it is necessary to make even stronger use of the potentials
on the global procurement markets in addition to the activities on the
sales market. China, India, and Eastern Europe will be the primary regions
for these efforts.
Car Driveline Technology
-In 2007, the Car Driveline Technology division expects an increase
in sales of 4 %, which is slightly above the industry average.
Car Chassis Technology
-In the year 2007, the Car Chassis Technology division expects major
challenges similar to those in the year 2006. As a result of the termination
of a large passenger car axle contract, the division anticipates a stagnation
respectively decline in sales.
Commercial Vehicle and Special Driveline Technology
- In 2007, economic developments in the European commercial vehicle
industry are expected to remain positive. Further market growth is apparent
in the Asia-Pacific and South American regions, while a decline is anticipated
in the North American market. The division will continue its market
and product offensive and expects sales growth of 8 %. The next steps
for the volume production launch of the new EcoLife automatic transmission
at the Friedrichshafen location are imminent. In Boutheon/France, volume
production of the AS Tronic mid automatic transmission range for medium
trucks is ramping up. Local presence is being expanded in China and
Off-Road Driveline Technology and Axle Systems
- The Off-Road Driveline Technology and Axle Systems division is well
positioned for future challenges because intense efforts were made in
the year 2006 to develop new product generations to meet these challenges;
in addition, sales activities worldwide were considerably intensified
in order to tap into new markets. After the 20 % surge in growth in
the year 2006, the division expects growth in the order of 4 % in 2007.
Powertrain and Suspension Components
- In light of the moderate growth prospects of today's core passenger
car markets in Western Europe and North America, the division does not
anticipate any considerable impulses.
However, the commercial vehicle market continues to promise a high sales
level. New products for passenger cars and commercial vehicles, such
as hybrid components and modules, as well as system-compatible controlled
damping systems will become more important on the market.
All in all, the division anticipates increasing sales of nearly 6 %
again in the year 2007.
- In the year 2007, the Rubber-Metal Technology business unit anticipates
a further slight increase in sales. Price pressure from automotive manufacturers
and the necessity to relocate production to best cost countries in the
Asian-Pacific region will continue. The business unit will expand its
presence in growth markets and with the rapidly growing, primarily Asian,
ZF Lenksysteme GmbH
- Based on the market forecasts for 2007, ZF Lenksysteme only anticipates
slight sales growth. Nevertheless, further improvements in results are
expected. This will, however, only be possible if maximum effort is
made to reduce costs.