ZF Friedrichshafen AG Business Report FY2011

Business Highlights

Financial Overview

(in million euros)
  FY2011 FY2010 Rate of change (%) Factors
Sales 15,509 12,907 20.2 -
EBITDA 1,574 1,296 21.5 -

Business Overview

Powertrain Technology
-The Division's sales in 2011 totaled 3,941 million euros.

-In the parent plant in Saarbrucken, Germany, some 1.4 million automatic transmissions were produced in 2011.

-The Company has manufactured the one-millionth 8-speed automatic transmission (8HP) at the plant in Saarbrucken, Germany. The company started production of 8HP in summer 2008. It is supplying the 8HP for various brands, such as Alpina, Audi, Bentley, BMW, Jaguar, Land Rover, and Rolls-Royce. (From a press release on August 31, 2011)

-The Company's transmission plant in the German city of Brandenburg has built a total of three million passenger car transmissions for BMW. Currently, the second generation of the 6-speed manual transmission for BMW is being produced there. Since 1998, its plant has been delivering manual transmissions for BMW. Since 2008, the Company has been producing the 7-speed dual clutch transmission (7DT) for Porsche at the Brandenburg location. Porsche is using it in its models "911", "Boxster", "Cayman", and "Panamera". (From a press release on March 21, 2011)

-Despite the critical discussion relating to general economic developments, almost all its customers of the Powertrain Technology Division are calling for capacity increases over the coming year so that further sales and turnover increases of roughly 18% can be expected.

Chassis Technology
-The prior year's strong market demand continued unbroken in 2011 and generated a sales increase to 4,260 million euros.

-The plants in Changchun and Shenyang (China), as well as in Tuscaloosa, Alabama (USA), and Solihull (UK) considerably exceeded sales and volume forecasts.

-As to the Chassis Components business unit, the business unit won a large number of new and follow-up orders - both from existing business relations and from new customers. However, rising raw materials prices depressed the result.

-The Rubber & Plastics business unit's sales in 2011 increased by 30% to 664 million euros. A positive development is the continuous market success of electrically switchable engine mounts as well as its newly created plastic modules product group.

-The Suspension Technology business unit increased its market shares through a number of new order acquisitions in conventional shock absorbers/dampers and active suspension technology (e.g. from Audi, GM and Opel), which are reflected in a sales increase of approx. 11%. Especially worth mentioning here is the positive business development with Toyota and Honda. Consequently, the target results were exceeded in 2011 despite continued raw materials cost pressure and intense competition.

-The Division's sales in 2012 is expected to grow about 7% due to further increase in its customers' capacity worldwide and the launch of new projects.

Commercial Vehicle and Special Driveline Technology
-During the course of the year, the Division's performance benefited from business trends exceeding expectations, especially on the European and South American markets, although growth dynamics slackened in the last quarter. Sales totaled 3,275 million euros.

-All business units increased their sales.

-The Company announced that the 100,000th commercial vehicle transmission Ecomid was manufactured in its plant in Boutheon, France. The 9-speed transmission is adapted to the needs of medium-duty trucks. Since 1998, the location in Boutheon has been part of the ZF Group and now also produces the automatic transmission AS Tronic mid. The Boutheon plant delivers Ecomid transmissions to about 30 customers all over the world, among these Hino, MAN, Renault Trucks, Isuzu, Volvo, Iveco, Ashok Leyland, Force Motors, DAF, and Ford Otosan. The main part of the transmissions is destined to Germany, France, and Japan. (From a press release on April 8, 2011)

Steering Systems; ZF Lenksysteme GmbH
-Strong growth continued in 2011, and sales increased by 19% to 3,566 million euros. With this, the joint venture achieved the highest sales figures in its history. All business units and regions played a part in the sales increase.

-The strong growth in passenger car steering systems was driven by the electric power steering system, which once again achieved enormous growth. Sales of hydraulic steering systems were unexpectedly high, at almost the same level as in the prior year.

-The production of the Servolectric electric power steering system by the Division has exceeded 20 million units. Compared to a hydraulically assisted power steering system, the electric power steering system saves 0.4 liters of fuel per 100 kilometers. (From a press release on September 13, 2011)

-The Company announced that it has produced an aggregate total of 12 million speed-sensitive power steering systems Servotronic since it began producing them in 1986. (From a press release on August 2, 2011)


-Followings are major contracts from a press release in 2011.
Maker/ Model Products
All BMW models -8-speed automatic transmission
Chrysler "300", "Dodge Charger" -8-speed automatic transmission
Bentley "Mulsanne" -8-speed automatic transmission
Rolls-Royce "Ghost" -8-speed automatic transmission
Lancia "Thema" -8-speed automatic transmission
-Gearshift system
-Standard damper for front axle
-Self-leveling dampening systems for the rear axle
Volkswagen "Amarok" -8-speed automatic transmission
VDL "Futura" -Front and rear axle
-Tag axle
-Steering system
-Front axle single wheel suspension
-Drive axle
-Compact ball-and-nut power steering
-Steering column
VDL "Citea SLF" -Independent wheel suspension
-Portal axle
-Steering column
LiaZ (GAZ Group) Low-floor city buses -Automatic transmission
-Front-axle system
-Portal axles
-Steering pump
-Ball-and-nut power steering system
Audi "Q5 Hybrid quattro" -Full hybrid variant of the 8-speed automatic transmission
Nova Bus (Volvo) Low-floor articulated buses -6-speed automatic transmission
Toyota "Lexus IS F" -Mono tube shock absorber
Land Rover prototype "Range_e", based on the "Range Rover Sport" -8-speed hybrid transmission
Porsche "911", "Boxster", "Cayman", "Panamera" -7-speed dual clutch transmission
Successor of the Saab "9-3" -Complete rear axle system
-Front axle component
Hyundai "Equus" -6-speed automatic transmission
-Hydraulic damper
-CDC electronic damping system
Daimler "Mercedes-Benz Citaro" -Low-floor independent suspension
-Portal axle
-Steering pump
-Angle drive
-Power steering system
Volvo "B9TL" -Portal axle
-Steering pump
-Angle drive
-Power steering system
GM "Chevrolet Volt" -Electric power steering system
Ford "Explorer", "Taurus", "Lincoln MKS" -Axle system

Business Restructuring

-The Company has completed the merger of 12 of its major German companies into ZF Friedrichshafen AG and started new operation based on the realignment this month. Up until last year, the Group had conducted its business by dividing its group companies into seven divisions according to the product lines and business functions of respective operations. At the beginning of 2011, however, it restructured its business into four divisions, which consisted of the Powertrain Technology, Chassis Technology, Commercial Vehicle Technology and Industrial Technology, while reallocating each group company to either of the four units. The purpose of the realignment is to highlight the Group's comprehensive strength in the global automotive market, which is experiencing a transition to a new area, as sales of low-cost vehicles are growing in emerging markets and electrification of automobiles is further accelerating. The reorganization will also help the Group use its management resources in a more effective manner. (From an article in the Nikkan Jidosha Shimbun on August 12, 2011)


-The Company announced that it acquires the Nuremberg plant from the German automotive supplier Honsel. The Company thus secures its supply chain for automatic passenger car transmissions and enhances its expertise in lightweight construction. In the current business year, the Nuremberg plant is to achieve sales of approximately 150 million euros. In Nuremberg, Honsel mainly produces passenger car transmission housings and transmission components from aluminum and magnesium. The Company obtains housings for its 6-speed, 8-speed, and dual-clutch transmissions as well as transmission control parts from Nuremberg. Honsel had been taken over recently by Martinrea International Inc. and Anchorage Capital Group. (From a press release on July 8, 2011)

-The Company announced that it will acquire the plant of Bauknecht Hausgerate GmbH in Neunkirchen (Saarland), Germany at the beginning of the year 2012. The expansion possibilities at the main location in Saarbrucken are nearly exhausted so that the production of transmission components will be relocated to the plant in Neunkirchen. At this location, the Company will produce components for passenger car automatic transmissions and takes over about 240 Bauknecht employees. The plant founded in 1970 in Neunkirchen offers a space of about 40,000 square meters for production, warehousing, and offices on 10-hectare premises. (From a press release on July 4, 2011)

Business Partnership

-The Company signed a cooperation contract with Saab Automobile. As of 2012, the Company will deliver complete rear axle systems as well as front axle components for the successor of the Saab "9-3". As part of a cooperation project, a the Company sub-assembly plant is now being built in the Swedish city of Halvorstorp, located three kilometers away from the Saab Automobile production plant in Trollhattan. The new plant in Halvorstorp will produce the front and rear sub-frames. The Company will mount rear axle systems on to the rear chassis sub-frames. The front axle is assembled by Saab Automobile. For this purpose, the Company also delivers shock absorbers and steering components. Apart from the Saab "9-3", the Company is to develop the chassis of new Saab models. (From a press release on March 18, 2011)

Recent Development Outside Germany

-The Company will launch an initiative to propose new technology that can reduce vehicle weight by 100 kilograms to Japanese automakers. Using plastics such as fiber-reinforced composite materials for struts and other chassis components, airbag housings, and pedal modules which are currently made of metals, will slash product weight without compromising on product strength. Leveraging superior formability of plastic materials, parts numbers can be also reduced significantly, contributing to a 20 to 40 percent saving in cost. According to the Company, replacing seven metal parts, including suspension components and an oil pan, with plastic based components is expected to lead to a 100 kilogram cut-down on vehicle weight. In the area of suspension units, the company will initially market a multilink rear suspension with a wheel-controlling transverse leaf spring. The rear suspension is designed for compact, front-wheel-drive vehicles. As it uses fewer parts and requires less complexity, the company says it is suitable for low-cost vehicles sold in emerging markets. The more compact unit compared with that conventionally used in front-wheel-drive cars, will also offer extended battery loading space to electric vehicles. (From an article in the Nikkan Jidosha Shimbun on May 11, 2011)


-The Company announced that it has received the "Supplier Innovation Award" from the BMW Group. The Company received the prize in the "Efficient Dynamics" category for the 8-speed automatic transmission. (From a press release on November 9, 2011)

-ZF Passau GmbH and ZF Drivetech Hangzhou Co. Ltd. are awarded "Best Supplier" for the fourth time in a row from Foton. ZF provides the Chinese market with such as driveline and chassis components, passenger car and commercial vehicle transmissions, axle systems, steering technology. (From a press release on March 11, 2011)

-The Changchun plant of Chassis Systems business unit was awarded the "Excellent Supplier Reward" by FAW-VW.

-The Company announced that it was awarded "Supplier of the Year Award 2010" from the Hyundai Kia Automotive Group. Hyundai's sedan, the "Equus", is equipped with ZF 6-speed automatic transmission, and hydraulic dampers by ZF Sachs. In the case of the "Equus" top model, there is also the CDC electronic damping system on board. In the commercial vehicle business, the Company delivers transmissions and bus axles to Hyundai Kia. (From a press release on February 21, 2011)


R&D Expenditure

(in million euros)
  FY2011 FY2010 FY2009
Total 754 646 663

-The Company will invest around 750 million euros in research and development, almost the same level in the prior year.

R&D Structure

-Approximately 6,200 employees work for ZF Research and Development worldwide. Of those, about 870 engineers and technicians work at the ZF Group's Corporate Research and Development department in Friedrichshafen, Germany, as well as an additional 270 in Pilsen, Czech Republic; Shanghai, China; and Tokyo, Japan. The Company intends to increase its numbers of research and development personnel abroad by hiring qualified engineers there to help address future R&D needs. In the year under review, 754 million euro were invested in research and development, representing 5% of sales and thus the the Company's target for research and development expenses.

-New Asian headquarters and R&D center built in Shanghai officially started operations on June 8, 2010. The new headquarters office is 6,000 square meters, and the R&D center is 4,000 square meters in size. When the planned second phase of construction is completed in the future, the floor space will be increased by an additional 20,000 square meters. The R&D facility now employs 100 people, but the company is planning to increase the number to 300 by 2013.

R&D Facilities

<Major R&D Facilities>
Location Main theme
Friedrichshafen, Germany -Corporate research
-Advanced development
Dielingen, Germany -Chassis system
-Chassis component
Schweinfurt, Germany -Powertrain module
Passau, Germany -Differential
-Test system
Schwaebisch-Gmuend, Germany -Steering for passenger cars and commercial vehicles
Northville, USA -Transmission
-Chassis clutch
Shanghai, China -


-As in previous years, the Company was also able to maintain its position among the top patent applicants in Germany in 2011. At over 900, the number of internal patent applications in considerably higher than in the last reporting year.  Innovative activities were focused on transmission system technology. New, up-and-coming areas are electronic control systems for transmissions, electric drives, and axle systems.

R&D Activities

-The Company is currently working on integrating power electronics into its transmission. In order to develop an integrated solution, the Company and BMW launched the research project called "Electric components for active power transmissions" (EfA). On the basis of an 8-speed full hybrid transmission from the Company, the project partners Infineon, Kemet, and Liebherr, are developing a power electronics unit, which can be mounted to the transmission.  (From a press release on April 6, 2011)

Product Development

Full hybrid variant of the 8-speed automatic transmission
-The Company announced that its full hybrid variant of the 8-speed automatic transmission (8HP) is first produced in volume in the Audi "Q5 hybrid quattro" starting in 2011. This version facilitates purely electric driving without changing the basic transmission concept. Thanks to hybridization, a medium cycle consumption of 6.9L/100km or 159g CO2 emissions/km according to the NEDC is possible. In this hybrid solution by the Company, combustion engine and electric engine are directly connected and can thus be operated at the same time. Thanks to the 8HP's modular design, the full hybrid version needs the same installation space as the transmission's standard system: Electric motor, clutch, torsional vibration damper, and hydraulics have been integrated in a space-saving and efficient manner. The DynaStart electric motor with 40 kW, positioned directly on the driveline, is sufficient to facilitate emission-free driving up to 100 km/h and, at the same time, serves as starter. Audi already announced the system for the A6 and the A8. (From a press release on September 8, 2011)

9-speed automatic transmission for passenger cars
-The Company developed an automatic transmission with nine speeds for passenger cars with front transverse drive. With two model ranges, it covers a torque range between 280 and 480 Nm. The new 9-speed automatic transmission (9HP) can deliver fuel saving up to 16% compared to today's standard 6-speed automatic transmissions in front transverse installations. The 9HP can be installed in many vehicle applications such as all-wheel drive, stop-start and hybrid system. (From a press release on June 7, 2011)

9-speed automatic transmission for FWD passenger cars
-The Company announced development of 9-speed automatic transmission for FWD passenger cars.  Production will soon start in the U.S., where U.S. automakers will mount them on their cars.  It is the world's first 9-speed automatic passenger car transmission.  Featuring fuel economy as a result of more gears, the Company aims to address the needs of automakers, working on CO2 reduction during driving. (From an article in the Nikkan Jidosha Shimbun on January 18, 2011)

Low-floor portal axle
-The Company will present the new low-floor portal axle AV 133. The new axle generation will be introduced in two stages - to be implemented by 2014. The first implementation stage, focusing on higher torque resistance, optimization of maintainability and weight, will be completed by the end of 2011. During 2014, the second stage will focus on the further improvement of efficiency, noise level and weight. The new AV 133 facilitates heavy-weight applications – such as double-articulated buses – because it is designed to withstand higher torques. The new axle can easily be integrated into existing vehicle platforms because it has the same axle connection points as the current model AV 132. (From a press release on October 21, 2011)

Electric driveline for small vehicles
-The Company developed the electric driveline Electric Twist Beam, which is designed for small vehicles. The electric driveline is integrated in a semi-independent rear suspension, and a transmission/electric motor unit is installed in a space-saving way on each rear wheel. The advantage of this electric rear-wheel drive with a 60 kW output is its compact integration that leaves space in the middle of the vehicle. (From a press release on September 5, 2011)

Lightweight brake pedal
-The Company developed the lightweight brake pedal produced on the basis of endless fiber reinforced composite materials and injection molding. About 50 percent weight can be saved compared to a standard brake pedal made of steel. (From a press release on September 5, 2011)

All-wheel drive system for passenger cars
-The Company developed a new all-wheel drive system for passenger cars. Through its automatic decoupling function, over-consumption can be reduced to a minimum. A reduction in consumption by approximately five percent is possible in comparison with conventional all-wheel drives. At the same time, the vehicle dynamics and driving safety rise through distribution of torque to the individual wheels. The front-transverse architecture also enables a combination with the new 9-speed automatic transmission from the Company. (From a press release on April 14, 2011)

Investment Activities

Capital Expenditure

(in million euros)
Powertrain Technology 428
Chassis Technology 203
Commercial Vehicle Technology 84
Die Casting Technology 38
Steering Systems
(ZF Lenksysteme GmbH)
Other 161
Total 1,058

-Capital expenditure will reach a new record high of approximately 1,300 million in 2012.

Investment Outside Germany

-The Company is setting up its first passenger car transmission plant in North America. As of 2013, on approximately 90,000 square meters ground in Greenville, South Carolina, 8 and 9-speed automatic transmission will be U.S.-manufactured for the North American market. The company will invest 350 million USD and create 900 new jobs in this facility. The 9-speed automatic transmission presented to the public at the North American International Auto Show will also produced at this plant. In 2010, a plant for the production of axles and drives was opened in Marysville, Michigan, U.S.. The Florence, Kentucky plant, at which electric steering systems are made, is presently being expanded.

-In 2011, the Steering System (ZF Lenksysteme GmbH) opened a new plant in Yantai, China.