AB SKF Business Report FY ended Dec. 2013

Business Highlights

Financial Overview

(in million SEK)
  FY ended Dec. 31, 2013 FY ended Dec. 31, 2012 Rate of change (%) Factors
Net Sales 63,597 64,575 (1.5) 1)
Operating profit 3,693 7,314 (49.5) -
SKF Automotive Segment
Net Sales 17,421 17,123 1.7 2)
Operating profit 809 467 73.2 -

1) Net Sales
-In 2013, the Company's net sales decreased by 1.5% from the previous year to SEK 63,597 million. This decrease was due to a decrease in volume sales of approximately 0.7%, an increase in sales due to acquisitions of 2.5%, and negative currency effects of 3.3%.

2) SKF Automotive Segment
-Net sales in the fiscal year ended December 31, 2013 rose 1.7% from 2012 to SEK 17,421 million. This increase was due to organic growth of 5.3% and was slightly offset by a negative currency effect of 3.6%.

Business Partnership

-The Company announced that it signed a strategic partnership agreement with US-based Protean Electric. The Company will supply its expertise and automotive solutions for Protean's in-wheel electric drive for hybrid and electric vehicle markets. The strategic partnership is a five-year agreement that will initially focus on a wheel bearing system with integrated sealing and sensors developed specifically for Protean Electric. Protean Electric is a clean technology company that designs, develops and manufactures the Protean Drive, a fully integrated, in-wheel motor, direct-drive solution for electric hybrid vehicles. (From a press release on January 15, 2013)


-The Company recently signed two agreements to supply SKF wheel hub bearing units (HBU) for the front and rear wheels for four different Fiat and Jeep models on the new X-UV platform. The agreements are expected to be worth to approximately SEK 1 billion combined (USD 151 million) and will run for seven years each. (From a press release on November 21, 2013)

-The Company announced that it will start deliveries according to Volvo Car Corporation in China. According to the contract, the Company will deliver wheel hub bearing units (HBU) and MacPherson suspension bearing units (MSBU) for the newly launched Volvo S60L car model. The Company has been supplying HBUs and MSBUs for the Volvo S80L car model in China since 2007. (From a press release on October 30, 2013)

-The Company was awarded a contract to supply its next generation wheel hub bearing units (HBU3) to Volvo Car Corporation. The Company will supply the HBU3, which was specifically developed according to Volvo's demanding technical specifications, for Volvo's scalable product architecture (SPA). (From a press release on June 10, 2013)

-SKF Sealing Solutions Korea Co., Ltd., a subsidiary of the Company, will supply Bonded Piston Seals (BPSs) for the Toyota Highlander. The program is worth approximately KRW 10 billion. BPSs are also used on vehicles built by Mazda, General Motors and Hyundai Motor. (From a press release, May 18, 2013)

-The Company won additional business from Great Wall Motors in 2013 and will supply high-pressure valve stem seals for engine valve trains and bearing retainers for transmissions.

-The Company received an order from Hyundai Motors worth approximately SEK 370 million for its MacPherson suspension bearing units. The components will be equipped on Hyundai and Kia models including the cee'd, Forte, Soul, i30, Sonata, K5, i40, Grandeur, K7, Santa Fe and Sorento.

-The Company signed an agreement with Tesla Motors in 2013 to supply SKF Energy Efficient deep groove ball bearings and low weight hybrid (ceramic) bearings for the electric motor and gearbox in the Tesla Model S.


Major awards won in 2013
Company Country Award
Meritor Brazil Certificate of recognition of the best suppliers
Tesla Motors USA Excellent Quality 2013
Fiat Italy Fiat Qualitas Award - Best quality supplier
Fiat Argentina Fiat Qualitas Award
Geely China Geely Global Excellent Supplier Award
Nissan China Investment Company China NCIC Supplier Quality Award 2012
Bosch Germany Preferred Supplier of the Bosch Group
Paccar Germany PACCAR's 2012 Quality Award
Bosch Group Germany Preferred Supplier
General Motors China SGM GP-8 Excellence Award
General Motors China SGM Quarterly Star Award
General Motors Korea Supplier Quality Excellence Award 2013
General Motors Germany Supplier Quality Excellence Award 2013
General Motors Brazil Supplier Quality Excellence Award 2013
Volvo Car Cooperation Sweden Volvo Quality Excellence Award 2013
General Motors Korea 2012 Supplier of the Year


R&D Expenditure

(in million SEK)
  FY ended Dec. 31, 2013 FY ended Dec. 31, 2012 FY ended Dec. 31, 2011
Overall 1,840 1,607 1,481

R&D Facilities

-The Company currently has global technical centers in Shanghai, China and Bengaluru, India. It is planning to build two new global technical centers in Gothenburg, Sweden and Nieuwegein, the Netherlands.


-In 2013, the Company successfully registered for 468 first filings of patent applications, up from 421 in the previous year.

R&D Activities

-In 2013, the results of the SaNatt project were presented. As a participant of the project, the Company had worked with various organizations in the automotive market and in academia over the past two years. The SaNatt project aimed to reduce the weight of a car by 20 to 40% and was designed to strengthen the competitiveness of the Swedish automotive industry. The Company's contribution to the project consisted of several components, including a concept carbon-fiber-reinforced polymer knuckle with an integrated bearing outer raceway which weighed half as much as the comparable component on the control vehicle.

Product Development

Truck engine cooling module
-The Company has developed the SKF Engine Fan Support Module, an integrated unit for the cooling of truck engines. Benefits of the module include high robustness, low weight and reduced application costs. A balanced rotating housing improves stiffness in order to cope with vibrations and high loads and to protect components. The SKF Engine Fan Support Module is produced in Luchow, Germany. (From a press release on November 26, 2013)

Angular steering column bearing
-The Company announced the launch of a new angular steering column bearing for passenger cars and light trucks. The component has been designed specifically for the next generations of luxury cars and electric vehicles. Keeping those markets in mind, the Company focused their efforts on the reduction of both noise levels and vibrations transmitted from the road to the driver. This results in an average torque reduction of 20 percent and a torque variation reduction of 80 percent. (From a press release on November 22, 2013)

Anti-corrosion coating for wheel bearing
-The Company developed an innovative solution for protecting wheel bearings against corrosion. The anti-corrosion coating for hub bearing units makes the disassembly of the bearing from the knuckle and rim easier. It improves the aesthetics of the bearing during vehicle life and at the same time prevents rusty surfaces from coming into contact with the seals, thus maintaining their effectiveness. (From a press release on November 22, 2013)

Double row angular contact ball bearing
-The Company announced that development has completed on a new cost-effective (CE) double row angular contact ball bearing suitable in trucks and agricultural applications such as seeding planters to disc harrows. The new SKF CE double row angular contact ball bearings are available in the 32 and 33 series and range from 20 to 50 millimeters in bore diameter. The CE bearings are equipped with standard low friction and noise glass fiber reinforced polyamide cages. Stamped steel cages are available as an option.  (From a press release on November 18, 2013)

Tapered roller bearing
-The Company launched the SKF Energy Efficient (E2) tapered roller bearing (TRB), specifically designed for final drive applications in heavy trucks to reduce friction, enable less fuel consumption and reduces emissions. Typical fuel savings achieved using this bearing in final drive are approximately 0.15 L per 100 km. In comparison with the Company's standard TRBs, the new SKF E2 TRB has been further improved with a friction reduction factor calculated at 30 percent. Additionally, a typical truck running 100,000 km per year, equipped with four bearings of this type, is estimated reduce emissions by 398 kg of CO2 per year. (From a press release on February 21, 2013)

Investment Activities

Capital Expenditure

(in million SEK)
  FY ended Dec. 31, 2013 FY ended Dec. 31, 2012 FY ended Dec. 31, 2011
Overall 1,746 1,968 1,839
-SKF Automotive  639 1,029 745

Investments Outside Sweden

-In 2013, the Company completed construction on a second factory at the facility in Jiading, Shanghai. The new factory will manufacture wheel bearings for passenger cars.