Orientation towards profitability
Despite the still difficult environment, it has become clear, particularly in the last third of last year, that the measures introduced are working and the company's financial situation is sustainably improving. ZF has consistently focused on profitable products and technologies in order to make itself more independent of market fluctuations in individual business areas - especially the passenger car segment. The company pursues the same goal with investment decisions for the industrial and commercial vehicle sectors as well as for the aftermarket. Conversely, ZF is divesting itself of investment-intensive business areas that do not promise positive returns in the long term - such as the plan to build its own shuttles.
Growth through collaborations
ZF also wants to outsource car axle assembly - but with the aim of operating this business more efficiently and in a more customer-oriented manner with an external partner. The final decision on this should be made in mid-2024. How the company wants to create further synergies through cooperation is illustrated by the world's largest factory for silicon carbide semiconductors, which is to be built together with the industry leader Wolfspeed in Saarland - and will be supplemented by a new research center in the greater Nuremberg area.
Also create synergies internally
The merger of two divisions to form the new Chassis Solutions unit also represents focus. ZF customers now only have one contact person for steering, braking and damping and get all driving dynamics systems from a single source. Because the innovations of the new division – with more than 30,000 employees worldwide and an annual turnover of 14 billion euros – also flow into industrial and commercial vehicle technology, all customers can benefit from economies of scale.
High priority: securing the German sites
For the CEO of ZF, the future of the German sites is also a high priority. In order to improve their competitiveness and secure employment in the long term, target-setting processes have been initiated, which have already led to concrete results for the Saarbrücken and Friedrichshafen sites.
ZF is advancing the transformation by picking up the pace and honing the focus. The increasing presence in global growth markets, investments in high yield products and technologies as well as a more efficient organizational structure are top priorities on the agenda. Details on this as well as on all key facts and figures on the 2023 annual accounts you can download here.
In fiscal year 2023, ZF achieved Group sales of €46.6 billion (2022: €43.8 billion), an increase of 6.5 percent compared to the previous year's value. Organic growth amounted to nine percent, the difference mainly due to currency effects. The adjusted EBIT of the ZF Group totaled €2,367 million (2022: €2,038 million), which corresponds to an adjusted EBIT margin of 5.1 percent (2022: 4.7 percent).
In the area of Research and Development (R&D), ZF has expanded its activities: At €3.5 billion, research and development expenses were slightly above the previous year’s figure of €3.4 billion. The R&D ratio was 7.6 percent (2022: 7.8 percent). Investments in property, plant and equipment amounted to €2.2 billion (2022: €1.9 billion), which corresponds to an investment ratio of 4.8 percent (2022: 4.3 percent).
Europe remained the strongest-selling region at 43.5% (2022: 42.7%). North America’s sales share decreased slightly from 28.5% to 28.1%. The share of sales in the Asia-Pacific region remained nearly unchanged at 24.2% (2022: 24.4%). The Region of South America has a sales share of 3.0%, and the Region of Africa of 1.2%.
Investments amounting to €2,235 million, an increase of 18% compared to the previous year, were made in the new technology fields of electric mobility and autonomous driving as well as established fields such as transmission applications (including hybridization), chassis systems, electronics, damper modules, brakes, steering systems and other safety technology.
The strategy is clear: ZF wants to grow in those areas in which the company is particularly strong and successfully positioned. The foundations for this have already been laid with far-reaching investment decisions.
2023 has shown that with our technological developments in recent years, we have correctly anticipated market developments. Today, ZF is a strong technology company with excellent market positioning and an attractive product portfolio.
With future-proof technologies, we can secure our lead and achieve our ambitious sustainability goals. ZF set new standards, with projects that prepare our supply chains and our product and service portfolio for the challenges of the future.
