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Divisions

Industrial

  • Products and solutions for approx. 7,800 customers from a variety of industrial sectors
  • Program “CORE” aimed at increasing earnings quality progressing on schedule
  • Mechatronic systems and digital services business combined into organizational unit Industry 4.0

Customers and products

The Industrial division understands and meets the needs of customers in numerous different 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 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 the OEMs 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 to these sector clusters, the division sells via distributors through the indirect distribution channel known as Industrial Distribution.

This structure has proven invaluable with respect to the Industrial division’s customers, since many customers have a regional focus. It allows the division to target its response to local customer needs even more closely 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 equally 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.

With a view to mobility, the Industrial division develops rolling bearings and power transmission solutions for bi- and motorcycles, rail vehicles, air- and spacecraft, as well as agricultural and construction machinery. A great deal of importance is placed on energy efficiency, for instance in eco-friendly engine designs in the aviation sector. Schaeffler offers bearing solutions for all types of drives, whether mechanical, electric, or hydraulic. The Industrial division’s technological expertise in the field of renewable energy is already on display in products and solutions for hydropower, solar energy, and wind power applications. Customers in the paper industry and in the raw material extraction, preparation, and processing sectors with their generally “heavy duty” rolling bearing applications play an important role for the Industrial division. For decades, this division has also been an innovative systems partner in the industrial automation sector cluster, particularly for machine tools and machinery for the textile, printing, food, and packaging industries as well as for medical technology and the semiconductor industry. Industrial Distribution is responsible for the business with distribution partners serving end customers and OEMs in the above sectors.

Customers require intelligent solutions and optimized lifecycle costs, which opens up new growth areas for the Industrial division. The newly established organizational unit Industry 4.0 is aimed at developing these growth areas. This unit combines the entire industry-specific business with mechatronic systems and digital services as well as the required related components. Industry 4.0 is to the Industrial division what electric mobility is to the Automotive OEM division. The field of Industry 4.0 is one of the key opportunities for the future under the strategy “Mobility for tomorrow". Consequently, the Industry 4.0 initiative was defined as part of the excellence program “Agenda 4 plus One”. The division plans on approx. 10% of revenue being generated by Industry 4.0 products and solutions by 2022.

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 approx. 3% at constant prices in the next five years. The growing number of competitors, especially from Asia, will intensify competition. Assuming this will cause prices to gradually decline, the relevant market will experience only a slight expansion.

Key growth drivers

In the future, the Industrial division’s success will also be based on its strong product portfolio for rotary and linear applications. Gained in 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 applications.

Components: The cornerstone of the successful growth of the Industrial division is its core business with components, which are constantly being developed further and improved. Successful examples of newly developed products are bearings of X-life quality or the innovative material known as Mancrodur. 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.

Mechanical systems, mechatronics, and Industry 4.0 services: Being successful in the systems business requires competitive components and an understanding of how they interact within the system. The Industrial division meets both of these requirements thanks to its many years of cooperating with its customers and providing advice to them. In the future, mechanical components, sensors, actuators, and electronic controls will increasingly be combined into integrated mechatronic systems. Examples of components equipped with sensors include the “Spindlesense” (spindle bearing equipped with sensors) and the “Durasense” (linear guidance system equipped with sensors) presented at the EMO trade fair in Hanover.

The Industrial division itself provides a significant proportion of development and value added, with the remainder sourced in cooperation with suppliers. Direct drives for rotary tables in the food industry and linear drives used in medical technology, for instance, are developed and manufactured in-house by the Industrial division.

Mechatronic systems supply the data that forms the basis for digital services reducing the customer’s lifecycle costs. Among other things, the Industrial division has been active in the field of “condition monitoring” (i.e. monitoring operating condition) for many years. Additional services are being developed and are aimed to help the the Industrial division grow faster than the market.

Program “CORE”

The program “CORE” started by Schaeffler AG’s Board of Managing Directors in 2015 is progressing on schedule. The agreed-upon staff reduction targets having been reached, the first wave was completed successfully. In order to achieve future earnings targets, the company worked hard to further develop the second wave in 2017 that was initiated by Schaeffler AG’s Board of Managing Directors in 2016. In addition to the measures addressing the production network and distribution that have already been communicated and executed, further efficiency measures are planned regarding overheads and production cost. Along with cost reductions, the company is also planning to increase its profitability using targeted price and portfolio measures. On this basis, the division aims to improve its EBIT margin before special items to 11 to 13% by 2020.

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