To increase its competitiveness and respond to the changes in the mobility sector, particularly in the field of e-mobility, ZF Friedrichshafen AG (ZF Group) is realigning its structures.

Due to strong competition, cost pressure and weak demand for electric vehicles, the restructuring will focus on the Electrified Powertrain Technologies division, said the global advanced mobility products and systems company in the press release.  

The global market segment for passenger car drives is highly competitive and subject to strong cost pressure, making it difficult to cross-finance purely electric drives, which often still have low margins, with drives for conventional and hybrid vehicles, explained ZF.

Besides, there is overcapacity in the electric-powertrain production lines that have been set up with high investments as a result of current glaring weakness in demand for purely electric vehicles.

On the other hand, the company stated that in line with the strategic guiding principle of “Strengthening strengths”, it will further increase its investments in its Commercial Vehicle Technology, Chassis Solutions, Industrial Technology and Aftermarket divisions.

Number of employees in Germany to decrease

ZF’s German locations will be merged into several site networks, and the number of employees in Germany will be gradually reduced by around 11,000 to as many as 14,000 from the current level of around 54,000 by the end of 2028, added ZF.

“The aim is to create an efficient production network on the one hand and an efficient organization of the research and development areas on the other,” said Prof. Dr. Peter Laier, who is responsible for Production on the ZF Board of Management.

Following the major acquisitions in recent years (TRW, 2015; Wabco, 2020), the ZF location structure in Germany has gradually expanded. The currently small-scale location structure is now being transformed into a sustainable and leaner location network structure in several phases.

“Our corporate responsibility is to position ZF for the future and to further develop our locations in Germany in such a way that they are sustainably competitive and solidly positioned. We are aware that we also must make difficult but necessary decisions to achieve this. But we want to come up with the best possible solutions for everyone involved,” said ZF CEO Dr. Holger Klein.