Investing In A Disruptive World

By Juergen Ziegler 

Juergen Ziegler is CEO of Europe Region and Member of the Executive Board of Schaeffler AG. Ziegler has been working for the Schaeffler Group since 2015 and has held the position of President of the South America sub-region until late 2016 heading the perennial process of restructuring the South America business. Since 2015 he was also Member of the Board of Directors of SONA BLW Präzisionsschmiede GmbH, Munich, Member of the Board of Directors of SONA BLW Precision Forgings Ltd, New Delhi, and Chairman of the Board of Directors of CONCEPT A.S., Istanbul. Based in Germany from January 2017, Ziegler took over responsibility for Schaeffler’s strategic ‘Program CORE’ and ‘Global Footprint’ strategic initiatives.

The automotive industry is facing enormous challenges and experiencing the greatest change since the invention of the automobile. Undisputedly, the future of the automobile and its industry is electric, autonomous, digital and shared. We can observe that our industry is not driven solely by market forces and changing consumer needs, but to a higher degree by regulatory requirements and industrial policy competition at the global level, where our traditional regulatory ideas count only to a limited extent. As a traditional manufacturing company, Schaeffler is facing challenges which are more dynamic, disruptive and global than expected.

The Schaeffler Group is a worldwide automotive and industrial supplier. With approximately 14 billion euros in sales in 2018, and 92,500 employees, the group has a worldwide presence of manufacturing plants, research and development facilities and sales locations in over 50 countries. Schaeffler is a family-owned business and at the same time publicly listed. Working closely with customers as a true partner to deliver a compelling value proposition through the expertise gathered in manufacturing technology and systems know-how, the Group is contributing to the success of the customers. As laid down in our company strategy, we are shaping the “Mobility for tomorrow.” In the light of global megatrends such as globalization, urbanization, climate change and digitalization, Schaeffler’s investments in the future are guided by a future-oriented and long-term vision and the values of a global family business.

Over the past few years, Schaeffler has applied its core engineering competence to expand its role as a mobility and digitalisation solutions provider. Mobility is traditionally one of the most important drivers for welfare, and digitalisation the most important one for progress. With the rapid pace of urbanisation, there is a growing need for new mobility solutions for people particularly to move around in cities. At Schaeffler we want to contribute to that development both with our intelligent, digitally-enabled products and our comprehensive systems know-how.

In handling the global challenges that we face, doing nothing is certainly not an alternative. Neither are radical strategy changes that completely question the core business that has been built up over decades. This is all the more true for an automotive and industrial supplier who thrives on trust, continuous improvement and long-term, sustainable and cooperative collaboration with its customers and suppliers. Going beyond, we are cognizant of the fact that technology as we know it today is transforming rapidly and while we focus on capability and competencies for the future, we are focused on our existing business and creating value for our shareholders.
Thus, to be best positioned for the future, we understand that it is necessary to pull the breaks and accelerate at the same time. For our investment decisions, this means to work towards improving performance, cost, efficiency, and quality of our products and systems while simultaneously investing in cutting-edge future technologies. During the last year, we invested in strategic M&A projects to complement our competencies in the field of e-mobility, autonomous driving, and Industry 4.0.

Contributing towards making the world cleaner, safer and smarter, the Group is investing in an integrated concept that enables synergy effects, know-how transfer, and capacity compensation. With a firm focus on production, technology, sourcing, and diversification to account for economic cycles, and to save costs, Schaeffler is emphasising on consistent localisation. A global player with a local presence continues to be the main driver and that will lead to greater success in the regions.

In India

In India, we see tremendous opportunities for the Schaeffler Group. With the successful merger of our three Indian companies – LuK India Pvt Ltd and INA Bearings India Pvt Ltd into Schaeffler India Limited (formerly FAG Bearings India) in October 2018, we committed ourselves even more strongly to the Indian market. Key objective for the merger is to combine the strengths and competencies of all three Schaeffler entities. Together, we are now stronger under the corporate brand of Schaeffler that will reinforce the already well recognised product brands of LuK, INA and FAG. For customers, this means a larger basket of products from one source. We will be able to combine our aftermarket distribution network to increase market reach. Our investors are excited to be part of one of the largest Industrial and automotive suppliers in India. Schaeffler India Ltd is a public listed entity with the ambition to excel at all topics of good corporate governance.

To shape our footprint in India, we have doubled the investment to the tune of 40 million euros this year and will continue on that level for the years to come. This will significantly boost our capacity, capability and competency to serve our customers in the region.

Schaeffler is a global player that operates and believes in the importance of a strong local presence. This enables the group to leverage its expertise and partner with customers to address the challenges of an increasingly complex and disruptive future. Based on our engineering skills and our highly committed employees we will manage the stretch between value-added investments and our core business, simultaneously with investments enabling to shape the future of mobility.

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