Optimization program
proves to be effective

Tense situation in the automotive industry requires consistent continuation of measures and targeted investments to pursue the sharpened strategy.

Broad-based optimization program of Webasto proves to be effective

Stockdorf – July 29, 2024 – After a weak financial year 2023, the business situation of Webasto, a top 100 supplier to the mobility sector worldwide, improved in the first half of this year. Despite a slight decline in turnover, the company has succeeded in significantly reducing its expenses and increasing its earnings. These results are part of a program launched at the start of 2024 to strengthen the financial resilience of the company. "We are on the right track and have made good operational progress in recent months to strengthen our financial performance. Structurally, we have been able to achieve the necessary job cuts through natural fluctuation so far and we are taking a restrictive approach to new hires,” explains Dr. Holger Engelmann, CEO of Webasto SE.

The systematic review of capacities and processes at the beginning of the program revealed some potential for optimization in regions, functions and business units. "As part of the expansion of our product portfolio towards electromobility and in anticipation of continuous strong growth, Webasto had built up structures in recent years which we now had to put to the test. This was particularly necessary because global conditions had deteriorated and the economy had clouded over considerably,” says Engelmann.

As a result, Webasto initiated various measures in the areas of research and development, purchasing and production. Particular attention is being paid to reducing direct and indirect costs, improving the performance and efficiency of the plants worldwide and increasing the profitability of customer projects. Engelmann emphasizes: “The overarching goal of these coordinated measures is to further our ability to invest in innovative vehicle technologies, even under difficult conditions. This is the only way we will maintain our competitive position in the roof systems and electromobility sectors."

Focus on roof and electrification business

Following important decisions in 2022, such as the expansion of roof expertise in the direction of glass refinement and the partner search for the charging business, Webasto realigned its strategic direction last year. With its “RE:focus” strategy, the technology company is concentrating on the areas of “Roof” (roof systems) and “Electrification” (batteries and thermo management solutions) in order to make a significant contribution to more climate-friendly mobility with innovative products in the future. Webasto has also defined five key success factors where special focus is set upon, including strengthening its financial resilience. “Only by continuing the long-term optimization program, can we successfully pursue our corporate strategy, which was sharpened in 2023,” says Engelmann.

Annual financial statements 2023: Stable sales with a black zero, electromobility

division records significant growth

In 2023, the Webasto Group achieved a profit margin of less than one percent on sales

of around 4.6 billion euros. Of that, 3.7 billion euros of Group sales were attributable to

roof systems business (“Roof” business area), while the company generated 900 million

euros with battery systems, heating and cooling solutions, and thermo management

solutions (“Electrification” business area). Sales of batteries for hybrid and electric

vehicles once again recorded particularly rapid growth, more than doubling for the fourth

year in a row to 226 million euros. Overall, the turnover of the Group increased by seven

percent in 2023 compared to the previous year (2022: 4.3 billion euros), while the

number of employees stagnated.

In regional terms, Europe made the largest contribution to the sales of Webasto last year

with 38 percent, followed by North America (25 percent), China (22 percent) and the

Asia-Pacific region (15 percent). The development of the individual regions compared to

the previous year varied greatly. While most regions developed positively, sales in China

fell for the first time since the company entered the market more than 20 years ago. This

decline also had a negative impact on the net profit of the Group.

Despite the tense situation, Webasto continued to invest in its already advanced

transformation in 2023. At 242 million euros, the investment ratio was 5.2 percent. The

focus was on building up expertise and capacity for acquired projects in the roof and

battery sectors. Expenditure on research and development in 2023 was primarily driven

by the battery business and, at 347 million euros, exceeded the expenditure of previous

years. This was 7.4 percent of turnover.

Structural changes essential for recurrent success

Engelmann underlines: “We continue our investment course, but the challenges in our

industry remain huge and often incalculable. It is already clear that we must intensify our

efforts to improve our financial situation and leverage further optimization potential in

order to remain fit for the future." The CEO of Webasto sees the cooperation with vehicle

manufacturers as a key approach to this. "The times of stable growth are over. The

contractual arrangements from the pre-crisis era are no longer sustainable. In view of the

enormous price developments and strongly fluctuating call-offs as part of series projects,

we need to readjust our business relationships. We are affected by a structural issue that

will ultimately weaken the entire automotive industry. We have to solve this together,”

demands Engelmann.