Bosch builds on technological innovation

This month, the company stopped production at about 100 Bosch sites worldwide and is systematically preparing for a gradual resumption of production. “We want to provide reliable supplies to meet the gradual increase in demand from our customers and help the global economy recover as quickly as possible,” said Dr. Volkmar Denner, Chairman of the Board of Directors of Robert Bosch GmbH. company's annual press conference. “Our goal is to synchronize the awakening of production and secure supply chains, especially in the automotive industry. We have already achieved this in China, where our 40 factories have resumed production and supply chains are stable. We are working hard to relaunch in our other regions. “In order to achieve successful growth in production, the company is taking a number of measures to protect employees from the coronavirus infection,” Dener said. Bosch is also committed to developing a coordinated, collaborative approach with customers. , suppliers, authorities and workers' representatives.

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Help reduce the coronavirus pandemic

“Where possible, we want to contribute to our pandemic activities, such as our newly developed Covid-19 rapid test, which is carried out with our Vivalytic analyzer,” said Bosch CEO Dener. “Demand is huge. We are doing our best to significantly increase production, and by the end of the year our capacity will be five times larger than originally planned,” he continued. In 2020, Bosch will produce over a million rapid tests, and this number will rise to three million next year. The Vivalytic analyzer will complement existing laboratory tests and will initially be used in hospitals and doctors' offices, primarily to protect medical personnel for whom rapid test results in less than two and a half hours are critical. Rapid tests are now available to customers in Europe marked "for research purposes only" and can be used after validation. Bosch will receive the CE mark for the product by the end of May. An even faster test that reliably detects Covid-19 cases in less than 45 minutes is in the final stages of development. “All our work in this area is based on our slogan “Technology for Life,” Dener said.

Bosch has already started production of protective masks. The company's 13 factories in 9 countries - from Bari in Italy to Bursa in Turkey and Anderson in the US - have taken the lead in producing masks to meet local needs. In addition, Bosch is currently building two fully automated production lines in Stuttgart-Feuerbach and will soon start mask production in Erbach, Germany, as well as in India and Mexico. “Our technical department develops the necessary equipment in just a few weeks,” Dener said. Bosch also provided its construction drawings to other companies free of charge. The company will be able to produce more than 500 masks per day. The masks are designed to protect employees at Bosch factories around the world. The goal is to make them available to other countries. It depends on obtaining the appropriate country-specific approvals. Bosch also produces 000 liters of disinfectant per week in Germany and the US for its workers in US and European factories. "Our people are doing a great job," Denner said.

Global economic development in 2020: recession negatively affects prospects

Bosch expects major challenges for the global economy this year due to the coronavirus pandemic: “We are preparing for a global recession that will have a significant impact on the development of our business in 2020,” said Prof. Stefan Azenkerschbaumer, CFO and Vice President. Bosch board. Based on current data, Bosch expects vehicle production to fall by at least 20% in 2020. In the first quarter of this year, the turnover of the Bosch Group fell by 7,3% and was significantly lower than last year. In March 2020 alone, sales fell 17%. Due to the uncertain situation, the company does not make a forecast for the whole year. “We have to make an incredible effort to achieve at least a balanced result,” said the chief financial officer. And in this major crisis, the diversification of our business is once again to our advantage.

Currently, the focus is on comprehensive measures to reduce costs and provide liquidity. These include reduced working hours and production cuts at many Bosch locations around the world, wage cuts for specialists and managers, including executive management, and investment extensions. Already at the beginning of 2020, Bosch already launched a comprehensive program to increase its competitiveness. “Our medium-term goal is to recover our operating income by about 7%, but without neglecting the important tasks of securing the company's future,” Azenkershbaumer said. “We are devoting all our energy to this goal and overcoming the coronavirus pandemic. In this way, we will create the financial foundation necessary to take advantage of the incredible opportunities that are opening up for the Bosch Group.”

Climate protection: Bosch pursues its ambitious goals

Despite the difficulties of the current situation, Bosch maintains its long-term strategic direction: the technology and service provider continues to pursue its ambitious climate goals and develop measures to increase sustainable mobility. “Although the focus is now on completely different issues, we must not lose sight of the future of our planet,” Dener said.

About a year ago, Bosch announced that it would be the first industrial plant to operate on a global scale and be climate neutral in all 2020 locations around the world by the end of 400. “We will achieve this goal,” Denner said. “At the end of 2019, we achieved carbon neutrality in all our locations in Germany; today we are 70% of the way to achieve this goal globally.” To make carbon neutrality a reality, Bosch is investing in energy efficiency by increasing the share of renewable energy in its energy supply, buying more green energy and offsetting inevitable carbon emissions. “The share of offset carbon emissions will be much lower than planned for 2020 – only 25% instead of almost 50%. We are improving the quality of the measures taken faster than expected,” Dener said.

Carbon-Neutral Economy: New Consulting Company Created

Bosch is taking two new approaches to its climate action to ensure they have a multiplier effect on the economy. The first goal is to make upstream and downstream activities – from “materials purchased” to “use of sold products” – as climate neutral as possible. By 2030, corresponding emissions (band 3) are expected to decrease by 15% or more than 50 million metric tons per year. To this end, Bosch has joined the Science Goals initiative. Bosch is the first supplier to the automotive industry to achieve measurable goals. Moreover, the company plans to combine the know-how and experience of 1000 Bosch experts from around the world and more than 1000 of its own projects in the field of energy efficiency in the new Bosch Climate consulting company.

Solutions - Bosch Climate Solutions. “We want to share our experience with other companies to help them move towards carbon neutrality,” Dener said.

Growth in the European market: the development of a hydrogen economy

“Climate protection is critical to human survival. It costs money, but inaction will cost us even more,” Dener said. "Policy should clear the way for companies to be inventive and apply technology to the environment - without sacrificing prosperity." Most important, Denner says, is a major technological advance that will not only widely spread electric mobility, but also increase the efficiency of internal combustion engines using renewable synthetic fuels and fuel cells. The Bosch CEO called for a bold transition to a hydrogen economy and renewable synthetic fuels after the coronavirus crisis is over. According to him, this is the only way for Europe to become climate neutral by 2050. “Right now, hydrogen applications need to leave the lab and enter the real economy,” Dener said. He urged politicians to support new technologies: "This is the only way we can achieve our ambitious climate goals."

Ready for hydrogen: mobile and stationary fuel cells

Climate action is accelerating structural change in many sectors. “Hydrogen is becoming increasingly important for both the automotive industry and construction equipment. Bosch is well prepared for this,” Denner said. Bosch and its partner Powercell are already working on the commercialization of mobile fuel cell packages for the automotive industry. The premiere is scheduled for 2022. Bosch intends to successfully position itself in another growing market: in 2030, one in eight newly registered heavy trucks will likely be powered by a fuel cell. Bosch is developing stationary fuel cells with its partner Ceres Power. They can supply power to office buildings such as computer centers. According to Bosch, by 2030 the market for fuel cell power plants will exceed 20 billion euros.

Drive Technologies and Heat Engineering: Assortment Electrification

“Initially, climate-neutral electrical solutions will only complement the internal combustion engines that have dominated so far,” Dener said. That's why Bosch is encouraging the development of neutral technologies for drive systems. According to the company's market research, two out of every three newly registered vehicles in 2030 will still run on diesel or petrol, with or without a hybrid option. That is why the company continues to invest in high-performance internal combustion engines. Thanks to new exhaust technologies from Bosch, NOx emissions from diesel engines are virtually eliminated, as independent tests have already shown. Bosch is also systematically improving the petrol engine: engine modifications and efficient exhaust aftertreatment now reduce particulate emissions by almost 70% below the Euro 6d standard. Bosch is also committed to renewable fuels, as legacy vehicles will also have a role to play in reducing CO2 emissions. When using renewable synthetic fuels, the combustion process can become carbon neutral. Therefore, in times of crisis, it would make more sense to offset the use of renewable synthetic fuels for car fleets, rather than tighten CO2 requirements for the automotive industry, Denner said.

Bosch is committed to becoming the market leader in electric mobility. To this end, the company is investing around 100 million euros this year in the production of electric powertrains at its plants in Eisenach and Hildesheim. Electrification is also included in heat engineering and modernizes heating systems. “We expect electrification in the boiler house over the next decade,” Dener said. That's why Bosch is investing another 100 million euros in its heat pump business, aiming to expand its R&D and double its market share.

Business development in 2019: stability in a weak market

“Against the background of a slowdown in the global economy and a 5,5% decline in the automotive industry, the Bosch Group showed stability in 2019,” said Azenkerschbaumer. Thanks to a wide range of successful products, sales reached 77,7 billion euros, down 0,9% from last year; after adjusting for the effect of exchange rate differences, the decrease was 2,1%. The Bosch Group generated an operating profit before interest and taxes of 3,3 billion euros. The EBIT margin from this activity is 4,2%. Excluding extraordinary income, mainly from the sale of packaging equipment, the profit margin is 3,5%. “Along with heavy initial investment, weak market conditions in China and India, the continued decline in demand for diesel vehicles and high restructuring costs, especially in the mobility segment, were factors that worsened the financial result,” said Azenkerschbaumer CFO. With a 46% ownership and a 9% cash flow from sales in 2019, Bosch's financial position was strong. R&D spending rose to 6,1 billion euros, or 7,8% of sales. Capital expenditures of around €5bn rose slightly year on year.

Business development in 2019 by business sector

Despite the decline in global car production, sales in automotive technology amounted to 46,8 billion euros. Revenue decreased by 1,6% year on year, or by 3,1% after adjusting for the effect of exchange rate differences. This means that Bosch's best-selling sector is ahead of global production. Operating profit margin is 1,9% of sales. During the year, business in the consumer goods sector began to improve. Sales amounted to 17,8 billion euros. The decrease is 0,3% or 0,8% after adjusting for the effect of exchange rate differences. The EBIT operating margin of 7,3% is lower year on year. The industrial equipment business sector felt the impact of a shrinking equipment market, but nonetheless increased its sales by 0,7% to EUR 7,5 billion; after correcting the effect of exchange rate differences, a slight decrease of 0,4% was noted. With the exception of the extraordinary proceeds from the sale of the Packaging Equipment business unit, the operating profit margin is 7% of the turnover. Revenues in the Energy and Construction Equipment business sector increased by 1,5% to EUR 5,6 billion, or 0,8%, after adjusting for the effect of exchange rate differences. EBIT margin from this activity is 5,1% of sales.

Business development in 2019 by region

Bosch's 2019 performance results vary from region to region. Sales in Europe reached 40,8 billion euros. They are 1,4% lower than the previous year, or 1,2% excluding exchange differences. Revenues in North America increased by 5,9% (just 0,6% after adjusting for exchange differences) to 13 billion euros. In South America, sales rose 0,1% to € 1,4 billion (6% after adjusting for the effect of exchange rate differences). Business in the Asia-Pacific region (including Africa) was again hit by declining auto production in India and China. : Sales fell 3,7% to 22,5 billion euros, down 5,4% excluding exchange differences.

Despite the decline in global car production, sales in automotive technology amounted to 46,8 billion euros. Revenue decreased by 1,6% year on year, or by 3,1% after adjusting for the effect of exchange rate differences. This means that Bosch's best-selling sector is ahead of global production. Operating profit margin is 1,9% of sales. During the year, business in the consumer goods sector began to improve. Sales amounted to 17,8 billion euros. The decrease is 0,3% or 0,8% after adjusting for the effect of exchange rate differences. The EBIT operating margin of 7,3% is lower year on year. The industrial equipment business sector felt the impact of a shrinking equipment market, but nonetheless increased its sales by 0,7% to EUR 7,5 billion; after correcting the effect of exchange rate differences, a slight decrease of 0,4% was noted. With the exception of the extraordinary proceeds from the sale of the Packaging Equipment business unit, the operating profit margin is 7% of the turnover. Revenues in the Energy and Construction Equipment business sector increased by 1,5% to EUR 5,6 billion, or 0,8%, after adjusting for the effect of exchange rate differences. EBIT margin from this activity is 5,1% of sales.

Business development in 2019 by region

Bosch's 2019 performance results vary from region to region. Sales in Europe reached 40,8 billion euros. They are 1,4% lower than the previous year, or 1,2% excluding exchange differences. Revenues in North America increased by 5,9% (just 0,6% after adjusting for exchange differences) to 13 billion euros. In South America, sales rose 0,1% to € 1,4 billion (6% after adjusting for the effect of exchange rate differences). Business in the Asia-Pacific region (including Africa) was again hit by declining auto production in India and China. : Sales fell 3,7% to 22,5 billion euros, down 5,4% excluding exchange differences.

Despite the decline in global car production, sales in automotive technology amounted to 46,8 billion euros. Revenue decreased by 1,6% year on year, or by 3,1% after adjusting for the effect of exchange rate differences. This means that Bosch's best-selling sector is ahead of global production. Operating profit margin is 1,9% of sales. During the year, business in the consumer goods sector began to improve. Sales amounted to 17,8 billion euros. The decrease is 0,3% or 0,8% after adjusting for the effect of exchange rate differences. The EBIT operating margin of 7,3% is lower year on year. The industrial equipment business sector felt the impact of a shrinking equipment market, but nonetheless increased its sales by 0,7% to EUR 7,5 billion; after correcting the effect of exchange rate differences, a slight decrease of 0,4% was noted. With the exception of the extraordinary proceeds from the sale of the Packaging Equipment business unit, the operating profit margin is 7% of the turnover. Revenues in the Energy and Construction Equipment business sector increased by 1,5% to EUR 5,6 billion, or 0,8%, after adjusting for the effect of exchange rate differences. EBIT margin from this activity is 5,1% of sales.

Business development in 2019 by region

Bosch's 2019 performance results vary from region to region. Sales in Europe reached 40,8 billion euros. They are 1,4% lower than the previous year, or 1,2% excluding exchange differences. Revenues in North America increased by 5,9% (just 0,6% after adjusting for exchange differences) to 13 billion euros. In South America, sales rose 0,1% to € 1,4 billion (6% after adjusting for the effect of exchange rate differences). Business in the Asia-Pacific region (including Africa) was again hit by declining auto production in India and China. : Sales fell 3,7% to 22,5 billion euros, down 5,4% excluding exchange differences.

Staff: every fifth employee works in the field of development and research

As of December 31, 2019, the Bosch Group has 398 employees in more than 150 subsidiaries and regional companies in 440 countries. A significant role in reducing the number of employees by 60% per year is played by the sale of the Packaging Equipment Division. 2,9 specialists work in the field of research and development, which is almost 72 more than in the previous year. In 600, the number of software developers in the company increased by more than 4000% and amounted to about 2019 people.