The Bosch Group increased its sales significantly in 2021, reaching pre-pandemic levels.
As a major supplier to the automotive industry, it has been hit by the decline from chip shortages. Despite this, total sales rose 10 percent to €78.8bn.
“Our business performed much better in 2021 than expected,” said Dr Stefan Hartung, chairman of the board of management of Robert Bosch. “We were able to exceed our forecasts despite many challenges, such as cost burdens due to supply bottlenecks and price increases for raw materials.”
The company is continuing to invest in strategically important fields, including a total of around E1bn in microelectronics and electromobility this year. At the same time, Bosch is increasingly focusing on partnerships, such as the recently announced alliance with Volkswagen in the field of automated driving.
The efforts of many countries to move toward a climate-neutral economy will also significantly stimulate growth in the future for the company. “Climate action is driving our business forward – from mobility solutions and industrial automation to building technology and home appliances,” said Hartung. “And thanks to connectivity and artificial intelligence, energy efficiency will continue to improve.”
As a result Bosch was able to increase its sales of connected power tools, home appliances, and heating systems by 50 percent in 2021 – from 4 million units in 2020 to more than 6 million.
Between now and 2030, the company plans to cut carbon emissions along its supply chain – from purchasing to product use – by 15 percent.
“We are generating billions in sales with electromobility. We’re also growing at double-digit rates with heat pumps for the home, and electrical drives are making inroads in industrial technology,” Hartung said. He believes this puts the company in a strong position: “Bosch is translating climate action into growth.”
Total sales grow year on year, but they are also higher than in 2019, the year before the crisis.
“The company’s broad diversification across different industries and regions paid off once again,” said Dr. Markus Forschner, member of the board of management and chief financial officer of Robert Bosch “All business sectors increased their sales despite global supply bottlenecks.”
The Mobility Solutions business is the largest and saw sales rise 7.5 percent to €45.4bn despite the chip shortage, which had a particularly major impact on the automotive industry.
The Industrial Technology business benefited particularly from the recovery in the mechanical engineering market and achieved sales of €6.1bn. This is an increase of 20 percent, both in nominal terms and after adjusting for exchange-rate effects.
In the Consumer Goods business, products for the home and garden were once again in strong demand. At €21bn, sales were significantly above the previous year’s level. This is a rise of 13 percent, while sales in the Energy and Building Technology business rose 11 percent to €5.9bn.
Growth in all regions
“Regionally as well, Bosch sales grew across the board,” said Forschner. In Europe, sales grew by 9.3 percent to €41.5bn. After adjusting for exchange-rate effects, this is an increase of 10 percent. In North America, sales came to €11.5bn. The increase in sales of 6.5 percent becomes 10 percent after adjusting for exchange-rate effects.
In South America, sales rose to €1.4bn, an increase of 32 percent, or 41 percent after adjusting for exchange-rate effects. “This is a very positive development, especially since the region was hit particularly hard by the coronavirus pandemic the previous year,” he said. In Asia Pacific, sales grew by 12 percent to €24.4bn – up 11 percent after adjusting for exchange-rate effects.
Bosch is also tapping further growth potential in electromobility. Since the end of 2021, the company has been manufacturing silicon carbide power devices, and by 2024, the company plans to invest more than €400m in stationary solid-oxide fuel cell (SOFC) technology and a further €600m in mobile fuel cells.
Bosch has also entered the factory equipment business for battery production with Volkswagen. “Our common goal is for a European supplier to be the cost and technology leader in the volume production of battery technology,” said Hartung.
Bosch also intends to expand its position in software development for vehicles. The Mobility Solutions business sector already equips vehicles worldwide with more than 200 million control units running its proprietary software each year. The company expects the market for automotive software to reach a volume of some 200 billion euros by 2030.
“Bosch will see double-digit growth in this market,” said Dr. Markus Heyn, the new chairman of the Mobility Solutions business sector and member of the board of management of Robert Bosch GmbH. “Here we will benefit in no small part from the evolution of the car into an internet node.”
According to Heyn, Bosch has already set the strategic course for this. The company’s portfolio of application-independent vehicle software will be brought together in its ETAS subsidiary in mid-2022. ETAS will offer basic vehicle software, middleware, cloud services, and development tools for universal application.
In addition, Bosch’s new Cross-Domain Computing Solutions division will create application-specific vehicle software with special hardware for functions such as driver assistance and automated driving. Bosch also entered into a wide-ranging alliance with Cariad, Volkswagen’s software subsidiary, at the end of January 2022. “Our goal is to accelerate the process of making partially and highly automated driving in everyday vehicles a reality,” said Heyn. “We want to set standards for the market that will benefit other automakers.”
The Bosch Group employs some 401,300 associates worldwide. Most of this increase of some 6,700 related to Asia Pacific and Europe; the number of associates in Germany remained stable at around 131,400. In research and development, the number of associates rose by just under 4 percent to 76,300. The number of software developers worldwide was more than 38,000 – an increase of some 4,000 over the previous year.
Bosch expects the global economy to grow between 4 and 4.5 percent in 2022, as against 5.5 percent in 2021 as Covid-19 continues to bite.
In addition, ongoing supply bottlenecks and rising prices for raw materials, primary products, and transportation will have a major impact on the global economy and affect the business of many sectors, especially the automotive industry. The marked rise in inflation in many sectors and regions is also clouding the outlook. Provided the business environment is not disrupted further, the Bosch Group expects to grow its sales in 2022.