The 41st Tokyo Motor Show 2009

• Recession leaves its mark on Bosch business results
• Flexible response to the economic downturn
• 7,500 Bosch associates in Japan
• Japan the largest Bosch development location outside Germany

Tokyo – "This year the Tokyo Motor Show is taking place in a period of transition," said Dr. Bernd Bohr, Chairman of the Bosch Automotive Group, in his opening words at the Bosch press conference. To secure the long-term success of the automotive industry, automakers and suppliers must in the future balance their attention between mature and emerging markets. "By 2035, the world's passenger car fleet is set to double. And the majority of new cars will hit the roads in India and China," Bohr said.

This shift to emerging markets will be accompanied by several structural changes that will require automakers and suppliers to rethink their strategies. The greater demand for smaller, more affordable cars will be one of these changes. And further reducing the fuel consumption and CO2 emissions of vehicles is also gaining importance. What is more, limited oil reserves, rising fuel prices and governmental policies will drive automakers and suppliers to step up their development activities for the electrification of the car. Finally, as the number of vehicles on the world's roads increases, passenger safety will become more important than ever.

Bosch is well prepared for structural changes

As the leading global automotive supplier, Bosch is well prepared to meet the challenges ahead. Despite the current downturn in global markets, the company has continued to focus on the future by developing beneficial innovative technologies and bringing them to market – in line with its corporate slogan "Invented for life."

The recession has also left a clear mark on Bosch's result. For 2009, the Bosch Group expects sales to decrease by 15 percent, to some 38 billion euros. In its automotive businesses, the decline in worldwide sales will be as much as 20 percent at year-end. This situation has also been reflected in Japan, where year-on-year automotive sales have dropped by some 28 percent. By the end of 2009, the Bosch Group will have some 270,000 associates worldwide, with 7,500 working in Japan. The Automotive Technology business sector will count 160,000 associates worldwide, with some 6,300 located in Japan.

Following a deep recession: signs of stabilization

Following the deep recession, Bohr sees clear signs that the situation has stabilized for the automotive business. In the past few months, orders have begun to improve and Bosch has acquired major new projects. This will support the company's growth in the coming years. However, Bohr said, "It could take us until 2012 to return to the pre-recession levels of 2007."

Even in these difficult times, Bosch has stayed true to its long-term strategy, which is based on entrepreneurial independence and financial stability. These are the principles that have enabled Bosch to maintain a strong competitive position despite the recession. "These principles also enable us to develop innovative technologies that make driving safer, easier, more eco-friendly and more economical," Bohr said. In 2009, R&D expenditure in Automotive Technology has remained high despite the recession, at some three billion euros. These resources are used to promote forward-looking projects.

Bosch engineers have thus been able to continue improving the internal-combustion engine. As a result, both gasoline and diesel engines will consume 30 percent less fuel in the medium term. Especially because of its availability and affordability, the diesel engine is set to see strong growth in Asia's emerging markets, and is particularly successful in India.

"We are also intensifying our activities in the area of hybrid technologies," Bohr said. This technology is particularly well suited to the driving conditions in Japan's urban areas, which are characterized by short distances and stop-and-go traffic. The first Bosch hybrid systems are set to go into series production in 2010 with the Porsche Cayenne and Volkswagen Touareg. The company also recently entered into a strategic partnership with Peugeot to develop, manufacture, and supply electric motors and power electronics for the automaker's diesel hybrid all-wheel-drive powertrain.

By the end of 2009, up to 500 Bosch engineers will be working on advancing hybrid and electric drive technologies. In addition, with the SB LiMotive joint venture, Bosch is collaborating with Samsung SDI to further develop lithium-ion battery technology for use in the automobile. Here, some 400 associates are working to develop lithium-ion cells and batteries for hybrid and electric vehicles.

From 2011: Series production of lithium-ion cells for the automobile

SB LiMotive will begin series production of lithium-ion cells in 2011, and the cells are set to be featured in BMW's Megacity Vehicle. BMW is the joint venture's first customer, "and we are in very promising discussions with several other car manufacturers," Bohr said. By producing large volumes of battery cells and packs, SB LiMotive will not only be able to cater to growing demand in years to come, but will also benefit from economies of scale. "By the end of 2012, we expect to be producing lithium-ion cells equivalent to a capacity of more than 600,000 kilowatt hours," Bohr said.

As the demand for personal mobility grows around the world, road safety has become more important than ever. This is especially true in light of increasing demand for small cars, many of which are still not equipped with advanced safety systems. In the small vehicle segments, Bosch aims to increase active safety to compensate for these vehicles' more limited passive safety.

While current installation levels for the Electronic Stability Control (ESC) stand at 68 percent in North America and 57 percent in Europe, in Japan only 34 percent of new vehicles are equipped with this anti-skid system. According to a recent Japanese-German study, ESC can also be beneficial in Japan's traffic situations. The study shows that if all Japan's cars were equipped with ESC, 6 out of every 100 fatal traffic accidents and some 13,000 injuries could be prevented each year.

Also thanks to measures and policies being introduced as a result of Japan's Intelligent Transport System and Advance Safety Vehicle initiatives, ESC installation rates in Japan are expected to rise to 67 percent by 2014. Today, Bosch is already well-represented in Japan's market for ESC and ABS anti-lock braking systems, with a market share of 24 percent.

"Moreover, we are cooperating with several Japanese automakers," Bohr said. "As we move forward, we continue to add to our range of safety-enhancing technologies." From 2010, Bosch will collaborate with German automaker Audi to bring its Predictive Emergency Braking System, PEBS, into series production. The system evaluates the combined signals of radar and video sensors. If drivers fail to respond to an emergency, the system can then trigger an automatic full emergency braking function. This new system can prevent three out of four rear-end collisions.

Japanese automakers –
important partners for Bosch R&D activities

In the area of driving safety, Bosch continues to see Japanese vehicle manufacturers as important partners for research and development. Today, for example, Japan is already the Bosch center of competence for motorcycle ABS. And since demand for automobiles equipped with ESC is expected to rise strongly both in Japan and international markets, the company is expanding its application engineering bases in Yokohama and Memanbetsu (Hokkaido), with investments totaling 7.8 billion yen. These expansion projects will not only make Japan the largest Bosch engineering base for braking systems outside Germany, but will also allow the company to serve Asian markets better – in line with Bosch's "in the region, for the region" strategy.

As a result of the company's focus on building local and regional centers of competence, today some 30 percent of the Bosch Automotive Group's engineers work in Asia, with almost 1,300 located in Japan. The local expertise that Bosch has acquired in both emerging and mature markets makes the company a strong partner for Japanese automakers both at home and abroad.

Contact person for press inquiries

Thomas Knoll

Phone: +49 711 811-7088

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