Automotive supplier - Bosch: Return target postponed by up to two years
The world's largest automotive supplier Bosch needs more time to achieve its sales and profit targets. "We are not cutting back on our targets, but we have to take note of the economic realities in the environment - even if this leads to a delay of one to two years," CEO Stefan Hartung told Handelsblatt. 2024 will be more difficult than expected, 2025 probably too. "We are currently discussing which delays will enable us to achieve which return and sales targets."
Originally, the technology group wanted to achieve its target return of seven percent in the 2024 or 2025 financial year. According to the Group, it needs this to be financially independent. However, Hartung stuck to the targets for 2023: "We are still aiming for a margin of five percent this year. It is achievable, but there are still currency risks in China and Turkey, for example". However, five percent is not enough to achieve dynamic growth. "It is clear that we must continue to work on our performance".
The change in the automotive industry - from combustion engines to electric engines and hydrogen - presents Bosch with major challenges. Just last week, it was announced that the Group is considering major job cuts in the drive division.
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Bosch, aiming for a seven percent return in either the 2024 or 2025 financial year, has acknowledged the need for a potential delay due to economic challenges. The CEO of Bosch, Stefan Hartung, shared this news with Handelsblatt, implying that 2024 might be more challenging than anticipated, and 2025 might follow suit. Bosch is currently evaluating the extent of these delays to align them with its return and sales targets.
Originally, Bosch, as Germany's prominent electronics supplier, aimed to secure financial independence through this return target. However, Hartung still maintains the five percent margin target for 2023, despite the existing currency risks in China and Turkey. Despite this, reaching a five percent margin may not support dynamic growth, prompting Bosch to focus on improving its overall performance.
In the face of industry changes from combustion engines to electric and hydrogen engines, Bosch is grappling with significant challenges. Just last week, the group announced potential major job cuts in its drive division to adapt to these changes.
The automotive sector's transformation necessitates prompt adjustments, as shown by the abrupt end to e-car subsidies in certain regions. Bosch must adapt its strategies accordingly to remain competitive in the evolving market.
Source: www.stern.de
