Automotive News Europe - July 2019 - 21

AUTOMOTIVE NEWS EUROPE

SUPPLIERS

Supplier TALK FROM THE TOP

Speed bump
Webasto chief remains 'optimistic' about tough 2020 goal despite sales dip

ebasto's 2018 global sales dipped
2.2 percent to 3.4 billion euros,
ending an eight-year growth streak.
The decline means the German supplier
will need to increase sales by roughly
46 percent to reach its target of 5 billion
euros by 2020. Webasto Chairman Holger Engelmann discussed this challenge
and more with Automotive News Europe
Managing Editor Douglas A. Bolduc.
Can Webasto still reach its global
sales target of 5 billion euros by 2020
after last year's decline?
We remain optimistic but we know that
with the current market situation it is
more than an ambitious target especially
since we are committed to investing in
our future. Though we are growing, no
one really knows how things will develop
when you hear news about tariffs here
and political changes there every day. If
it is exactly 5 billion euros by 2020, time
will tell. Achieving this won't just be due
to the contracts and orders we already
have on hand, it will largely depend on
volumes, which are highly impacted by
the overall economic situation, making
them difficult to predict.
Earnings before interest and taxes fell
19 percent to 202 million euros last
year and your profit margin slipped to
5.9 percent from 7.5 percent in 2017.
What happened?
Last year we invested heavily in our new
businesses. It was roughly 65 million euros more in 2018 than in 2017. This pretty much explains the drop in the result.
Why do you expect Webasto's profit
margin to be below 5.9 percent in
2019 despite forecasting higher sales?
In 2019 we will continue to invest in our
new businesses and our core business.
This will continue to burden our results.
Also, being fiscally conservative, we
make sure that costs impact our results
in the same year we spend the money.
Additionally, we see that production volumes are volatile. This leads us to believe
that 2019 will be difficult results-wise.
Nevertheless, we will maintain our course
because we want to grow and we know
we need to keep investing in our further
strategic development.

JULY 2019

Meet the boss
❚ NAME: Holger Engelmann
❚ TITLE: Webasto Chairman
❚ AGE: 54
❚ MAIN CHALLENGE:

Increasing sales to 5 billion euros
by 2020 despite global economic
uncertainty and large investments in e-mobility.

Why did Webasto put 271 million euros
into r&d and another 248 million euros
into investments last year?
We did so to build up a battery business and
a charging business as well as expand our
electrical heating business. These areas of
business may contribute more to our costs
than our overall turnover at the moment,
however, building up three future-oriented
businesses should positively impact our results in the years to come.
What were the key investments and
how do they make Webasto better?
We have focused on developing e-mobility products and enhancing our mechatronic competence. In addition we have
further strengthened our core business.
Our aim is to make our products better and more innovative to ensure we
maintain our technical leadership. When
it comes to our global presence, we acquired AeroVironment's Efficient Energy
Systems business in Monrovia, California [it's now called Webasto Charging
Systems] last year. We are also expand-

ing our footprint in China. This year we
will quadruple the size of our plant in
Wuhan and open up a new plant in Jiaxing. The number of orders that we have
on hand requires this.
What is your industry outlook for vehicle production for Europe, the United
States and China?
At best, the global production volume
curve will be flat. There will be no growth
and there is a high risk of a decline. The
question is how severe this is going to be.
This uncertainty is due to tariffs as well as
the political situations in Germany and Italy. On the other hand, if the U.S. and China
reach a trade agreement, things could
start quickly moving in a positive direction.
Will Webasto grow faster than the
market? If so, by how much and why?
In the midterm, we should grow faster
than the overall global market, especially
in China. This is based on the growing
demand for roofs, which has resulted in
a high backlog of orders for us. Factoring
in the successful introduction of our new
business areas, we will also be able to increase our global sales by offering a wider
range of products. Additionally, we have
acquired complete ownership of our former joint venture in South Korea, Webasto
Donghee, which will contribute annual
sales of roughly 350 million euros a year.
Last year Webasto added the Jeep
Wrangler softtop and you were awarded another SUV convertible project.
Can you say who the project is with
and update us on the development of
the crossover cabriolet niche?
For that order we are investing about 40
million euros in our facility in Plymouth,
Michigan, to produce this new roof for
the crossover convertible. We needed additional manufacturing space for this big
project. Start of production will be the
end of 2020. Unfortunately, I cannot provide more details.
What is your outlook for panorama
roofs and sunroofs?
We still see growth of roughly 4 percent
so it is above the growth of car production. This is because the growth in demand for panorama roofs in China is
outperforming the overall market. ANE

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Automotive News Europe - July 2019

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