The Schaeffler Group’s three-dimensional matrix organization divides the company’s business not only into divisions and functions, but also groups the company’s activities into the four regions Europe, Americas, Greater China, and Asia/Pacific. Each of the Schaeffler Group’s four regions is managed by a Regional CEO, who is a member of the Schaeffler Group’s Executive Board. This organizational arrangement allows for flexible management of the regions and facilitates cooperation with regional customers.
With approximately 170 locations worldwide, 73 production facilities, 20 research and development centers, and a tight-knit sales and service network, the Schaeffler Group ensures that its customers always find it close at hand – true to its guiding principle: “We are a global player with a local presence”. Cooperation across divisions and countries thus leads to a high degree of flexibility in solving new customer requirements and the opportunity of anticipating emerging trends early on.
Schaeffler continues to consistently work on changing its corporate image to the “Schaeffler” corporate brand. The LuK, INA, and FAG brand emblems have already been replaced with SCHAEFFLER at many locations and plants in the Europe, Americas, and Asia/Pacific regions. The new corporate design is an important element of the “Global Branding” project, one of the initiatives under the program for the future, the “Agenda 4 plus One”. The initiative is designed to help the company continue to press ahead with its strategy “Mobility for tomorrow”. Hence, the group is harmonizing its worldwide brand identity and corporate image – in line with “One Schaeffler. One Team. One voice”. For the Greater China region, the initiative was kicked off in September 2018 at the Anting location.
In its Global Footprint initiative, which is part of the “Agenda 4 plus One”, the Schaeffler Group is continually working to further develop its global stature. Among other things, the initiative includes expanding and creating regional research and development expertise, improving the structure of the global plant network and logistics activities, as well as realigning the distribution locations. In light of this, proactively localizing activities in the markets of the future constitutes one of the key challenges in implementing the strategy “Mobility for tomorrow". It also demands thinking even more deeply in terms of global connections and delegating responsibility away from head office in the future. In addition to improved cooperation with local customers and suppliers, the Schaeffler Group’s growing localization increases efficiencies in purchasing and logistics and generates several benefits regarding sustainability and the environment. The resulting growing regional presence is also reflected in a high degree of localization. The degree of localization describes the relation of a region’s sales to sales volume manufactured in that region.
The Europe region combines the subregions Germany; Western Europe, Central and Eastern Europe & Middle East and Africa (CEEMEA), as well as India. The Germany subregion represents the Schaeffler Group’s largest sales market. The Europe region contributed 51.3% (prior year: 51.2%) of consolidated revenue in 2018. The degree of localization amounted to approximately 96% (prior year: 96%) in 2018. The Europe region employed a total of 63,165 employees in 2018, representing 68.3% of the company’s entire workforce. This figure includes the employees of the group’s global head office in Herzogenaurach. The region has 46 plants and 12 R&D centers. Its regional head office is located in Schweinfurt.
In 2018, the Schaeffler Group decided to expand the mechatronics development and manufacturing facility into a digital training factory. The decision is part of the “Focus” initiative, which forms part of the “Agenda 4 plus One”. Construction and the move to the new premises, including appropriately refurbishing as well as combining them with those of Industry 4.0 and the vocational training facility, will be completed by the end of 2019.
As part of its program for the future, the “Agenda 4 plus One”, the Schaeffler Group is also strengthening the Buehl location in the Europe region by constructing a state-of-the-art development building and new headquarters for the company’s Automotive OEM division. This will also boost the company’s activities in the field of electric mobility worldwide. 350 new jobs, primarily in the field of electric mobility, are expected to be created over the next few years. The company will invest a total of approximately EUR 60 m in this location.
As part of the initiative described above, the Schaeffler Group decided to reorganize its UK business activities. The reorganization calls for the consolidation of the logistics centers in Sutton Coldfield and Hereford and the closure of the production locations Plymouth and Llanelli. These locations’ production will be moved to existing locations in other countries. The Sheffield location will be retained. The proposals are designed to generate synergies and increase efficiency.
Following completion of the merger of INA Bearings India Private Limited and LuK India Private Limited with listed company Schaeffler India Limited during the year, the Schaeffler Group now has only one subsidiary in India, the listed company Schaeffler India Limited. The transaction increased Schaeffler AG’s indirect interest in Schaeffler India Limited from approximately 51% to approximately 74%. This transaction has simplified the previous structure, reduced complexity, and created a strong Schaeffler entity in India in order to better realize the potential for growth in India.
The Americas region consists of the two subregions North America and South America. This region contributed 20.2% (prior year: 20.8%) of revenue in 2018. The degree of localization amounted to approximately 70% (prior year: 71%) in the Americas region. A total of 13,138 staff were employed at 14 plants and 5 R&D centers as well as at distribution locations in North and South America. The Americas region has its regional head office in Fort Mill in the U.S. The Schaeffler Group has been manufacturing in this region since 1953.
In Brazil, Schaeffler has been represented for 60 years now. Today, over 3,500 employees work at the almost 170,000 square meter site in Sorocaba. Schaeffler manufactures products for chassis, transmission, and engine systems for commercial vehicles, motorcycles, agricultural machinery, and many other industrial and automotive applications at this plant.
As China is a strategically important sales market for the Schaeffler Group, China and, among others, Taiwan and Hong Kong are managed together as a separate Greater China region. The regional head office is located in Anting in metropolitan Shanghai, China. Schaeffler’s first subsidiary in this region was founded in Taicang, China, in 1995. The region generated 18.0% (prior year: 17.5%) of group revenue in 2018. The degree of localization amounted to approximately 70% (prior year: 73%). A total of 12,976 staff were employed in Greater China. 8 plants and 1 R&D center are located in this region. As a consequence of the especially dynamic trend in recent years, it is important to the company to further expand not only E-Mobility, but also its local presence and to consistently raise the degree of localization in the future.
The Asia/Pacific region comprises the subregions South Korea, Japan, and the countries in Southeast Asia. The Schaeffler Group has been represented in this region since 1953. 10.5% (prior year: 10.5%) of group revenue was generated by this region in 2018. The degree of localization amounted to approximately 37% (prior year: 38%) in 2018. The Asia/Pacific region had 3,199 employees. The regional head office is located in Singapore. The Schaeffler Group operates a total of 5 plants and 2 R&D centers in this region. During the year, the company established a research and development center for the megatrend 21st century urban mobility in order to identify both the needs as well as the opportunities that come with urbanization. The “E-Mobility” initiative, which is part of the “Agenda 4 plus One”, opens up completely new opportunities and business fields for the company. The Schaeffler Group develops eco-friendly vehicle designs and urban mobility solutions for people in the megacities and reflects on the sustainable generation and storage of energy.