Tokyo – Bosch, a leading global supplier of innovative technologies and services, ended its 2015 fiscal year with around 270 billion yen (2 billion euros) in consolidated sales to third parties in Japan. Sales were impacted by the economic slowdown in China and decreased by 3.8 percent. Worldwide sales to Japanese auto makers* however, registered strong growth of 17 percent year-on-year. Depending on the economic trends, consolidated sales to third parties in Japan are expected to improve slightly in 2016, reflecting a projected increase in demand for automobile safety systems, gasoline direct injection systems, as well as the pharmaceutical inspection and packaging technologies.

Bosch also focuses to accelerate its investment into areas where Japan has specific strengths, such as automated driving, motorcycles, and the Internet of Things (IoT) solutions. "We believe that in doing so we can expand our business with Japanese customers further. Bosch will support its Japanese customers globally by reinforcing the links between its locations worldwide," said Udo Wolz, president and representative director of Bosch Corporation Japan. By accelerating its initiatives in these growth fields, Bosch aims for double-digit compound average growth rate of its worldwide sales to Japanese auto makers* over the next six years until 2021.

The number of associates employed at Bosch in Japan stood at more than 6,600 as of December 31, 2015. The number is expected to increase further in 2016.

Start of automated driving tests on public roads in Japan
"In 2015, Bosch started testing automated driving on public roads in Japan. This makes Japan the third automated driving development base after Germany and the U.S., and underscores the importance of the Japanese market," said Wolz. The Japanese road tests will enable further enhancement of Bosch's automated driving technologies by providing valuable observations from Japan's unique environment. Driving on the left and complex intersections provide valuable feedback to the German and U.S. teams, who have been working on automated driving development since 2011. One of Bosch's initial goals is the development of the highway pilot, which will allow cars to drive fully automated on freeways and freeway-like roads starting in 2021. Last year, Bosch fully acquired the former fifty-fifty joint venture Robert Bosch Automotive Steering GmbH, which became the Automotive Steering business division. Steering systems are a vital element of automated driving, which Bosch has now added to its portfolio. In Japan, Bosch will strengthen the links between automotive steering and automated driving development, eyeing future synergies.

Strong performance in the independent motorcycle business
In April 2015, Bosch integrated its motorcycle-related businesses and established Two-Wheeler and Powersports as an independent business unit. The Japanese motorcycle makers hold a large share of the global market. Therefore, the headquarters for this unit was set up in Yokohama. "The establishment of an independent business unit for Two-Wheelers has already had beneficial effects, as sales of products and services for motorcycles increased by approximately 20 percent", Wolz added. Motorcycle production is centered in China, India, and Southeast Asia, where small motorcycles of up to 250 cc displacement are popular. There is a growing need to improve the efficiency and safety of these small motorcycles. In fact, Bosch is the market leader in two-wheeler safety technology such as motorcycle ABS, which are now being promoted in every country throughout the world. Europe and Japan already plan to make ABS mandatory on motorcycles, and Brazil, India and Taiwan have already passed laws to make it mandatory in the future. It is also on the political agenda in Australia and the U.S. With growth in these motorcycle-related needs expected to drive further acceleration in the motorcycle-related business, Two-Wheeler and Powersports is aiming to achieve strong sales in the coming years.

Internet of Things (IoT) solutions provide new growth opportunities
It is not only the automated driving and motorcycle-related businesses that are driving Bosch's growth in Japan. Bosch is also working to provide IoT solutions in all of its business sectors: Mobility Solutions, Industrial Technology, Consumer Goods, and Energy and Building Technology. Bosch is the only company that is active in all three levels of the IoT: sensors, software and services. This makes Bosch different from traditional manufacturing companies. The company is increasingly using connected services to build on its broad basis in the hardware business. As it does so, Bosch benefits not just from its technological diversification, but also from its wide-ranging industry and domain expertise. The IoT is strategically important for Japan, and Bosch will focus its efforts on providing solutions in Japan. In order to do so, this year two new business units of Bosch will start activities in Japan: Bosch Global Service Solutions and Bosch Software Innovations.

Bosch Global Service Solutions offers services to internal and external customers on a global basis. The first service offering for the Japanese market will start by the end of 2016 with an emergency call service (eCall) for cars. This is a feature that enables a car to automatically notify rescue services when it detects the shock of a collision. The driver can also make an emergency call by manually pushing a button, if he/she is in trouble. This service is already provided in 41 countries worldwide. Bosch not only supplies the necessary hardware for this service, it also provides the communication services for actually making the emergency call.

Another important contributor to the connected solutions business of Bosch is Bosch Software Innovations, the software and systems house of the Bosch Group that designs, develops, and operates innovative software and solutions for the IoT. According to Frost & Sullivan, the Asia Pacific market for connected industry solutions will reach USD 15.48 billion by 2020. Of this, 76 percent will come from two markets: Japan and China. After having been active in Japan since 2013, Bosch Software Innovations has now opened its newest branch office in Tokyo to address the demand for industrial IoT solutions there. "Japan has become a world leader in smart urban services and is now looking to increasingly leverage IoT technologies in the energy generation and distribution sectors as well as the manufacturing industry also known as Industry 4.0. The high technological literacy among its people, coupled with strong support from the government makes Japan an extremely promising market for IoT solutions", said Thomas Jakob, regional president of Bosch Software Innovations Asia Pacific. "Our strong technology platforms combined with our extensive domain expertise, especially as a leading user and supplier of Industry 4.0 solutions, will help our clients in Japan to quickly realize returns on their IoT investments" Jakob continued. In this way, Bosch accelerates the development of IoT solutions in Japan and expands its business opportunities.

Cooperation with universities and governmental organizations extended to develop new business
As part of its efforts to develop new business fields, Bosch is boosting its level of cooperation with independent bodies such as Japanese universities and governmental organizations that are maximizing their knowhow regarding IoT solutions. For example, last year Bosch's smart agriculture project applying Bosch's knowhow on sensors, software, and services was accepted into the project on the promotion of the collaboration between agriculture, commerce and industry by the Japanese Ministry of Economy, Trade and Industry. Demonstration experiments have been conducted in collaboration by Chiba University and the University of Tsukuba. Bosch is also collaborating with independent organizations like IVI (Industrial Value Chain Initiative) and the IoT Acceleration Consortium to roll out initiatives related to IoT. Last year at IVI, Bosch, as a member of a quality assurance working group established through linking data, shared its experiences being a leading operator of connected manufacturing for optimizing processes. And at the IoT Acceleration Consortium, Bosch is planning to share its knowledge, particularly in the fields of manufacturing and mobility networking, as a supporting member of the IoT Acceleration Lab working group aimed at creating advanced business models utilizing IoT and establishing a framework for enhancing the relevant regulations.

New business unit for commercial and off-road vehicles
Bosch also established the new Commercial Vehicle and Off-Road business unit as part of efforts to become the leading supplier in the commercial, agricultural and construction machinery market. Trends like electrification, automation and connectivity are making inroads in these markets in the same way as in the passenger vehicle market. This new business unit will enable Bosch to propose solutions in response to these trends to meet the requirements of customers in the commercial and off-road vehicle segment. For trucks and other commercial vehicles, Bosch will focus on enhancing safety through greater automation, while also improving infrastructure issues and fleet management by rolling out various types of services. In the agricultural machinery segment, Bosch is aiming to implement productivity enhancing technologies, while in the construction machinery segment, Bosch is aiming to improve safety with automation and monitoring systems as well as to develop remote-controlled operating systems.

Strong sales growth in the Power Tools Division
Apart from Mobility Solutions, Bosch has also achieved notable growth in the power tools business in Japan. The Power Tools Division recorded the highest turnover in 2015, despite the contraction of the overall market. The successful growth reflects the launch of the new brand category "Smart Life Selection" to capture DIY entry-level users in 2015, as well as a large jump in sales of measuring tools such as laser measures. Smart Life Selection is a new brand category targeting consumers who are not used to DIY with proposals for enriching their lives and making them feel more convenient with the use of power tools. Under this new branding approach, the worldwide sales hit cordless screw driver "IXO" and the laser measure "PLR15" helped to acquire new entry-level users.

Bosch Group worldwide business outlook for 2016
Following a record year in 2015, the Bosch Group wants to continue its growth trend this year. The leading global supplier of technology and services expects worldwide sales to grow within an exchange rate-adjusted range of 3 to 5 percent in 2016. Speaking at the company's annual press conference in Germany, Bosch CEO Volkmar Denner said: "We plan to grow not only with innovative products, but also with innovative services". Next to Bosch Global Service Solutions division, the recently established Bosch IoT Cloud, as well as the Bosch Smart Home System launched at the start of 2016 contribute to this strategy.

* Japanese auto makers include motorcycle, agricultural and construction machinery manufacturers

Presentation Slides:
Bosch's diversification as a strategic advantage - A high-tech company that is also a supplier of services
Connectivity at Bosch - Enabler of connected solutions
Toward the car of the future- The vehicle as an active part of the Internet

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Bosch Car Multimedia Vision for 2021
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