Bosch CEO, Volkmar Denner, has indicated that the global car production has likely peaked, with no significant growth expected in the next decade. This prediction comes as the company’s 2019 profit fell by 44%, with a further decline anticipated in 2020. Bosch’s automotive division, which accounts for the majority of its business, was particularly hard hit due to a slump in demand and the shift towards electric vehicles.
Denner’s outlook aligns with the broader industry trend of declining car sales worldwide. China, the world’s largest car market, has seen a drop in sales for two consecutive years. In Europe, stricter emission standards have led to a decrease in demand for diesel cars, affecting suppliers like Bosch.
The shift towards electric vehicles is also impacting Bosch, which supplies components for combustion engines. While the company is investing in electric and fuel-cell technology, the transition is proving costly. Bosch has had to cut thousands of jobs in its automotive division and implement other cost-saving measures.
The company is also exploring new revenue streams in areas such as the Internet of Things (IoT) and artificial intelligence (AI). Bosch’s IoT business grew by 35% in 2019, and it plans to invest €4bn in AI by 2025.
Go to source article: https://www.bloomberg.com/news/articles/2020-01-29/bosch-ceo-calls-the-peak-in-global-car-output-as-profit-falls