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Industrial division

  • Components and systems for rotary and linear movements as well as services for OEMs and operators in eight sector clusters worldwide
  • Expansion of the business by Industry 4.0 solutions in progress; workforce expanded to approximately 300 in 2018
  • Program “CORE” completed as at the end of 2018 in light of the favorable earnings trend; remaining tasks transferred to the line functions

Customers and products

The Industrial division distributes components and systems for rotary and linear movements as well as services for a wide range of industrial sectors. It offers goods and services ranging from high-volume standard products to individual specialized solutions and from mechanical components through to mechatronic systems and digital services. The common denominator of these products and services is the technological expertise and the know-how covering the customer’s entire system. The management model of the Industrial division follows a regional approach based on the regions Europe, Americas, Greater China, and Asia/Pacific. Within the regions, the direct business with customers is grouped into eight sector clusters: (1) wind, (2) raw materials, (3) aerospace, (4) railway, (5) offroad, (6) two-wheelers, (7) power transmission, and (8) industrial automation. In addition, the business with distributors is managed by the Industrial Distribution unit.

Managing the business on a regional basis allows the division to closely target its response to local customer needs and to strengthen customer loyalty. Transregional issues, such as the global technology and product strategy, are driven forward by the close network linking the regions within the division. A global key account management function for key customers with operations in more than one region ensures that their needs are met with the same level of quality all over the world. Thus, the Industrial business is consistently aligned along customer and market needs and the course for its sustainable profitable growth has been set.

The Industrial division’s product portfolio includes a wide range of rolling and plain bearings, linear and direct drive technologies as well as services such as maintenance products and monitoring systems. The focus is increasingly on smart products and on connecting components, thus increasing machine and plant efficiency.

In the field of Industry 4.0, the Industrial division offers several platform designs for comprehensively improving systems. Whether in the drive train, in machine tools, predictive maintenance for wind power, or condition monitoring for trains – the Industrial division’s solution packages make Industry 4.0 very concrete. Using system integration via cloud-to-cloud communication, autonomous monitoring and lubrication of pumps, and electric motors that report their condition to the cloud, the Industrial division covers the broad range of possibilities for jointly making intelligent maintenance a reality. These solutions were impressively presented at last year’s Hannover Messe.

Sales markets

The key indicator for trends in the Industrial division’s relevant market is the global market volume for rolling and plain bearings, linear technology, and service products. The Industrial division expects market volume to increase by approximately 3% at constant prices in the next five years. The growing number of competitors, especially from Asia, will further intensify competition.

Key growth drivers

The Industrial division’s success will continue to be based on its strong product portfolio for rotary and linear applications in the future. Gained in many years of collaboration with customers, the know-how regarding the use of products in systems will enable the division to grow beyond rolling bearings with complex mechanical and mechatronic systems and Industry 4.0 products and services. Customers need intelligent solutions and cost reductions throughout the lifecycle of their systems, which opens up new growth areas for the Industrial division.

Components and mechanical systems: The cornerstone of the Industrial division’s successful growth is constantly advancing and improving components. Successful examples of newly developed products are bearings of X life quality – a seal of quality for particularly high-performance products – or the innovative material known as Vacrodur. The wide variety of goods and services, which comprises standard products offering good value for money, technical advice, as well as solutions developed specifically for the customer, offers the ideal balance between cost and benefit for every customer. Competitive components and an understanding of how they interact within the system are prerequisites for success in the systems business. The Industrial division has established these prerequisites in many years of cooperating with its customers and providing advice to them.

Industry 4.0: The key task of the Industry 4.0 unit of the Industrial division is developing mechatronic products, digital services, sector-specific solution packages, as well as new data-based business models. Examples of smart components include the axlebox generators introduced at the InnoTrans trade show and the rolling bearings equipped with sensors (“VarioSense”) presented at the Hannover Messe. Numerous Industry 4.0 products and solution packages in various project stages are already in use by customers today. These include, for instance, cloud-based monitoring of accessory units such as electric motors jointly with a service provider, a complete solution for monitoring and lubricating machines that are critical to the operations of a drinking water supply association, as well as an all-digital service for predicting the service life of rolling bearings in wind power transmissions. The next step will be using this experience to further expand the range of platform-based products on offer, allowing the division to respond to customer needs quickly and flexibly.

Along with condition monitoring systems that can detect initial damage early on and predictive maintenance systems designed to precisely predict a likely failure, the division is also pursuing other approaches. For instance, the division relies on more efficient operation of machines via increased productivity or performance as well as longer up times. The skills at the core of all Industry 4.0 solutions are the division’s mechanical expertise and systems know-how that are used to develop models and interpret operating data in order to generate essential added value for the customer.

The Industrial division aims to generate 10% of its revenue from Industry 4.0 products by 2022. In the future, all Industry 4.0 products and solutions will be offered under the Schaeffler brand, with a dedicated sales team ensuring close contact with customers.

Program “CORE” completed and “FIT” established

The program “CORE” started by Schaeffler AG’s Board of Managing Directors in 2015 to revitalize the Industrial division progressed on schedule. With the agreed-upon staff reduction targets reached and the full earnings impact achieved, the first wave was completed successfully. The division also worked hard on further implementing the second wave in 2018. Given the progress of the program “CORE” and the improved earnings trend, it was completed as at the end of 2018. In order to secure the results of the program “CORE” and to leverage efficiencies, the division launched a program named “FIT” in late 2018.

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