WABCO Global GmbH Business Report FY ended Dec. 2019

Financial Overview

(in million USD)
  FY ended Dec. 31, 2019 FY ended Dec. 31, 2018 Rate of change (%) Factors
Net Sales 3,421.4 3,831.0 (10.7) 1)
Operating Income 337.1 512.5 (34.2) -


Factors

1) Net Sales
-The Company’s net sales in the fiscal year ended December 31, 2019 totaled USD 3,421.4 million, a decrease of 10.7% over the previous year. Excluding foreign currency effects, the Company’s sales decreased by 7.0%. Total sales in Europe, which accounts 48% of its sales, decreased 11.5% and sales in North America decreased 5.3% compared to previous year.
  

Business development

A merger agreement with ZF Friedrichshafen AG
-The Company announced that it has entered into a definitive merger agreement with ZF Friedrichshafen AG. Under the agreement, ZF will acquire all outstanding shares of WABCO, listed on the NYSE, in an all-cash transaction for an equity value of over USD 7 billion. The transaction will bring together two global technology leaders, combining WABCO’s capabilities in commercial vehicle safety and efficiency, including technologies involved in vehicle dynamics control, active air suspension systems, and fleet management systems with ZF’s leading position in driveline and chassis technologies for cars and commercial vehicles. (From a press release on March 28, 2019)

Sale of R.H. Sheppard
-Knorr-Bremse is to acquire Sheppard for the agreed purchase price of USD 149.5 million from WABCO Holdings Inc., USA, which is selling Sheppard in connection with the proposed takeover of WABCO by ZF Friedrichshafen AG. Expected to close in the first half of 2020, the acquisition will be carried out by Bendix Commercial Vehicle Systems LLC, Elyria, USA, an indirect subsidiary of Knorr-Bremse AG and part of the Commercial Vehicle Systems Division. R.H. Sheppard Co., Inc. was founded in 1937 and manufactures components for the global commercial vehicle and transportation industries. The company develops and manufactures steering systems for commercial vehicles and related products. (From a press release on January 30, 2020)

  

Business Partnership

Partnership with Plug and Play
-Announced that it has signed a three-year agreement to be an anchor partner with Plug and Play, a global innovation platform leader headquartered in Silicon Valley, U.S. WABCO joins over 300 corporate partners from all over the world who are key to Plug and Play’s ongoing success, bringing together over 1,100 technology startups into the innovation process. Under the agreement, WABCO will gain access to Plug and Play’s extensive global partnership network which includes many of the best startups, market disruptors and industry leaders, enabling the co-creation of advanced new solutions and joint innovation initiatives. (From a press release on September 12, 2019)

Collaboration with TIP Trailer Services
-The company and TIP Trailer Services, an equipment service provider, announced the start of their innovative collaboration to fulfill TIP’s digitization strategy by connecting its fleet. TIP operates a fleet of 70,000 trailers which are available for full-service leasing and rental to transportation and logistics customers across 16 European countries and Canada. The agreement with the company will see TIP trailers upgraded with advanced trailer telematics and digital fleet management services providing the best solutions for TIP’s various trailer types. (From a press release on July 19, 2019) 

 

Contracts

-For the Fiscal year ended 31 December, 2019, the Company's contracts are below:

Air suspension system

-Announced that it has signed a long-term agreement to develop and supply air suspension technology for one of the world’s largest manufacturers of premium passenger cars, based in Europe. Under this latest 10-year agreement, it will develop and deliver an air supply module along with control software to operate a range of air suspension system configurations for one of the manufacturer’s high-volume global premium passenger car platforms. (From a press release dated February 4, 2019)

Power steering gears
-Announced that R. H. Sheppard has signed a USD 180 million long-term extension agreement with one of the world’s leading original equipment manufacturers (OEM) to supply power steering gears for its truck brands in the U.S.  Under the agreement, it will furnish the OEM with its leading M-Series and D-Series power steering gears, covering a broad range of Class 5 to 8 medium and heavy-duty trucks for two of the OEM‘s leading brands. (From a press release on March 26, 2019)

Fleet Management Solutions (FMS)
-Announced that has signed an agreement with Vos Logistics, one of Europe’s biggest logistics players, for its advanced Fleet Management Solutions (FMS). Under the agreement, it will deliver 1,200 TX-SKY on-board computers developed by its digital solutions business. TX-SKY will replace the existing FMS system that Vos Logistics has been relying on for over 20 years. Vos Logistics will also use its TX-FLEX app to support its drivers with out-of-cabin activities. (From a press release dated July 1, 2019)

Design and development of bus doors
-WABCO India signed a development agreement with Oy Tamware Ab, for the design and development of bus doors for the domestic commercial vehicle market. This agreement positions the company to exclusively produce door systems, both pneumatic and electric, designed by Tamware for the Indian market, in combination with its own door control system. Under the scope of this agreement, pneumatic or electric doors designed and developed by Tamware, will be manufactured in the Ambattur production facility of WABCO India. (From a press release on October 16, 2019)

AMT control technology
-The Company announced a global long-term agreement to supply its next generation automated manual transmission (AMT) control technology to Daimler. WABCO will develop and introduce its next generation AMT control technology into Daimler‘s global truck and bus series production. With a lighter-weight, robust and more compact design, WABCO’s new gearbox control unit reduces noise levels, optimizes gear shifting performance and increases driver comfort. In addition, the innovative new system is designed to support an extensive range of different truck types, gearboxes and market specific functionalities, which will support global AMT technology to further increase penetration in all regions. (From a press release on January 14, 2019)

 

R&D Expenditure 

(in million USD)
  FY ended Dec. 31, 2019 FY ended Dec. 31, 2018 FY ended Dec. 31, 2017
Overall 193.2 184.4 147.0

  

R&D

-Announced that it has established a new Fleet Solutions organization which will develop solutions designed to further connect today’s complex transportation ecosystem. The new business focuses on improving fleet and road transport safety, environmental efficiency, and enables leaner operations. Beyond spare parts and services offering, the expansion of its digital portfolio will be high on the agenda, including a rapid extension of its Internet of Things (IoT) and cloud-based technologies for commercial vehicle fleets and transporters globally. WABCO Fleet Solutions' 900 team operates from over 45 markets, represented by over 30 nationalities worldwide, enabling it to be as close to its customer base as possible. (From a press release on July 8, 2019)
 

Capital Expenditure

(in million USD)
  FY ended Dec. 31, 2019 FY ended Dec. 31, 2018 FY ended Dec. 31, 2017
Overall 153.6 132.1 110.5

 

Investment outside Belgium

<U.S.>
-WABCO USA LLC announced plans to triple its employment as it reinvests over USD 3 million in the distribution portion of its heavy duty truck parts manufacturing and warehousing facility in Hebron, Kentucky. WABCO’s investment, intended to boost the company’s OEM and aftermarket business, includes new equipment for increased volume and broader distribution of WABCO products throughout the U.S., Canada and Mexico. Work on the project begins in December and will be completed by spring 2020. (Kentucky Cabinet for Economic Development release on December 19, 2019)