Bosch: Weakening Economy and Stalling Ramp-Up of E-Mobility Slow Down Supplier

Due to the slow ramp-up of e-mobility and the tense economic situation, the technology company Bosch is holding back with its annual targets. "The markets are developing with delays – this is true for electric mobility, and it’s no different for hydrogen and heat pumps," said Bosch CEO Stefan Hartung on Thursday at the financial press conference in Renningen, Swabia. Although the company continues to see great growth opportunities in these areas, 2024 remains challenging.

Growth Field and Core Business: Sustainable Mobility

In its core business, Mobility, Bosch is driving strategic decisions for future growth with determination: This year alone, around 30 series projects for electric vehicles are starting.

"E-mobility is coming – the only question is how quickly in the different regions of the world," said Hartung. "In Europe, by 2030, we estimate that 70 percent of all new cars will likely be pure electric vehicles, while in China and North America, it will be 40 to 50 percent."

Where large distances need to be covered with heavy vehicles, solutions like plug-in hybrids and range extenders will still be in demand for some time, according to the company’s CEO. Bosch Mobility expects further momentum from driving dynamics technology: With new and redundant braking systems, particularly designed for electrified and automated driving, the supplier is growing annually by ten percent – significantly stronger than the market. With Vehicle Motion Management (VMM), Bosch is focusing on an innovative system solution that will coordinate all vehicle movements in the future by controlling brakes, steering, drivetrain, and damping. For recent winter tests alone, the Swabians have equipped more than 20 test vehicles from major brands with VMM variants.

"We are early on the move and will already go into series production with a first order this year," explained Hartung. Overall, the company aims to achieve a turnover in the triple-digit millions by 2030 with this system.

Growth Area: Hydrogen Engine to Aid in Commercial Vehicles

In the growth area of hydrogen, the supplier reaffirms its business expectations: by 2030, the revenue from hydrogen technology could potentially reach five billion euros. “Our production of fuel cell systems began in Stuttgart and Chongqing, China in 2023,” said Hartung. The lead market is expected to be China initially, with Bosch anticipating significant gains in Europe and North America only in the next decade. From a technical perspective, the fastest route to climate-neutral commercial vehicle traffic is possible with the hydrogen engine. The market volume for the relevant technology is expected to be nearly one billion euros by 2030.

The Bosch CEO stated: “As early as this year, a hydrogen engine featuring our injection technology will hit the roads in India, and we are already working on five series orders from well-known truck manufacturers across all parts of the triad.”

Bosch also aims to participate in the rapidly increasing hydrogen production: worldwide, the capacity for hydrogen electrolysis is expected to reach 170 gigawatts of installed power by 2030 – about 25 times as much as today. “With our electrolysis stack, we are on course for market entry next year,” explained Hartung. “In the future, Bosch is not only to be known for hydrogen drives but also for hydrogen production. As a supplier, we will actively shape the future market.”

Heat Pumps Are Also a Growth Area

The world's largest automotive supplier - which also sells household appliances, power tools, and heat pumps - aims to increase its sales by five to seven percent this year. The forecast is thus more cautious than last year. This is also due to the fact that no significant tailwinds from the global economy are expected, said Bosch CFO Markus Forschner. In the first three months of 2024, the group's sales even slightly declined compared to the previous year. As for profitability, signs point to stagnation: Forschner sees the company at most at the 2023 level.

Last year, the company, as previously reported, achieved sales of around 91.6 billion euros and an adjusted earnings before interest and taxes (Ebit) of 4.8 billion euros. This required the efforts of all forces, Hartung had said earlier in the year. In the end, around 2.6 billion euros remained - significantly more than the previous year. The return - in this case, the share of operating profit in sales - was 5.3 percent.