Bosch Wants to Triple Asian Sales by 2015

· Asia Pacific to contribute roughly 25 percent of total Bosch Group sales by 2015
· Bosch Plans to Invest a Further 1.4 Billion Euros in Asia Pacific Between 2008-2010

October Stuttgart/Seoul – The Bosch Group wants to achieve above-average growth in Asia Pacific over the next few years, and has set itself a target of 22 billion euros in sales by 2015. "By then, we want our Asian business to contribute a strong 25 percent to total sales," said Franz Fehrenbach, chairman of the Bosch board of management, at the opening of the new headquarters in Seoul, South Korea. For 2007, Bosch expects its Asian sales to total 7.4 billion euros. This is an increase of 8.5 percent. In local currency terms, average growth will be as high as 13 percent. The high level of capital expenditure seen in recent years is to continue: between 2008 and 2010, Bosch plans to invest 1.4 billion euros in Asia. Bosch has already invested 1.4 billion euros in the region between 2005 and 2007. The company will be expanding both its manufacturing facilities and its network of development and application centers, and will focus on automotive technology that protects the environment and conserves resources. "Asia Pacific is one of the drivers of our growth. We have a strong presence here and the right products to allow us to continue to grow dynamically with out customers in the future," Fehrenbach said.

In the region, the Bosch Group has now established a network of 58 sites, where it employs some 50,000 associates – and the signs point to further growth. Roughly 7,000 of these associates work at 18 research and development sites. "Bosch has had firm roots in Asia for a long time now. This means we know the markets very well, as well as our customers' requirements," Fehrenbach said. The company has had operations in China, for example, since 1909, in Japan since 1911, in South Korea since 1920, and in India since 1922. Bosch is building on these many years of experience: both in established markets such as Japan, Korea, and Australia, and in the dynamic growth markets of China, India, and the ASEAN countries.

"Green" technologies: the main growth driver in Asia, too
In the next few years, half of global GDP growth will be accounted for by the countries in Asia Pacific. By 2015, the region's economic output will reach the level of Europe and North America. By that time, it is estimated that the region's population will total some 4.4 billion. The Bosch Group is preparing for this growth. To take the example of the car: stricter environmental standards mean that efficient injection systems will increasingly be deployed in the countries of Asia. This is an especially good opportunity for the clean diesel, as well as for sales of economical gasoline systems. In addition, the demand for safety will increase significantly: braking control systems such as ABS and ESP® will gradually become established. In Suzhou, China, Bosch is currently expanding its production of control units for airbags, ABS, and ESP®, at a cost of roughly 100 million euros. Also in China, the company took Asia's largest winter test circuit into operation just a few months ago.

"We are strengthening our presence in Asia above all because we want to significantly grow the business we do with Asian automakers," Fehrenbach said. In the future, Bosch expects that by far the largest share of cars manufactured in Asia Pacific will continue to be made by Japanese, Chinese, South Korean, and Indian automakers. Today, the figure is roughly 93 percent. This also means that the low-price vehicle segment will become even more significant. These are cars whose net price is less than 7,000 euros. In 2015, it is expected that low-price vehicles' share of the global automobile market will be in excess of 15 percent. This translates into annual growth of roughly six percent: twice the rate of the automobile market as a whole. Bosch has already developed products specifically for this market: its Value Motronic, for example, is a particularly cost-effective control unit platform for gasoline engines with two, three, or four cylinders and port injection. "'Safe, clean, and economical' is increasingly taking on relevance for vehicles in Asia. Over the next few years, new models will gradually fulfill ever stricter exhaust regulations," Fehrenbach said.

Expanding infrastructure, modern building technology, market-driven consumer goods: Bosch technologies support Asia's growth
A focus on enabling sustainable mobility is only part of the story, however. The increasing number of infrastructure projects also present a great many opportunities for Bosch. From airports to power generation and new buildings: between 2006 and 2015, the average investment rate in Asia Pacific is expected to grow by just under nine percent per year. By 2015, just under 45 percent of the roughly 13.5 trillion euros of total global capital expenditure will be spent in this region. Even now, Bosch is already involved in many projects: its subsidiary Bosch Rexroth, for example, has supplied hydraulic drive systems for more than 1,000 wind farms in India, is delivering and installing stage technology for the "China National Grand Theatre," and has played a crucial role in automating the world's largest Ferris wheel, in Beijing. In addition, its Security Systems division is supplying the public address system for the Shanghai Stadium, and the access control and video surveillance systems for the Ministry of Information in Malaysia.

Bosch is also increasingly becoming a household name. Among the relevant target groups, Bosch already has more than 80 percent brand awareness in the key Asian markets. This is the result of consistent brand building and brand management. In addition, consumer goods developed specifically for the Asian market, and high-quality, on-the-spot service have played a key role in this success. At the beginning of 2007, for example, Bosch Power Tools opened Asia Pacific's largest training center for power tools in Hangzhou. In India, trucks loaded with Bosch power tools are constantly on hand for tradespeople, offering them advice.

"Soft" factors of success: trained associates, social commitment
Recruiting and training associates, and keeping skilled associates loyal to the company, are essential for success in Asia Pacific. Bosch has developed many programs in this area, especially programs aimed at developing managers from within the countries themselves. These programs include intensive cooperation with leading universities, recruiting events, graduate programs, and special training schemes. "In the long term, it is our aim for 80 percent of our managers in industrialized countries and emerging markets to be of national origin," Fehrenbach said. Apart from its business activities, Bosch also supports many social projects in Asia: these include projects of its own, as well as activities developed by associates. In Korea, for example, Bosch supports an old people's home for the homeless, and in India "Primavera," the association set up by Bosch associates, has taken over the sponsorship of a kindergarten near Bangalore. In the Philippines, the company is helping to establish an intensive-care unit for newborn children in Manila.

The Bosch Group is a leading global supplier of technology and services. In the areas of automotive and industrial technology, consumer goods, and building technology, some 260,000 associates generated sales of 43.7 billion euros in fiscal 2006. The Bosch Group comprises Robert Bosch GmbH and its roughly 300 subsidiary and regional companies in over 50 countries. This worldwide development, manufacturing, and sales network is the foundation for further growth. Bosch spends more than three billion euros each year for research and development, and in 2006 applied for over 3,000 patents worldwide. The company was set up in Stuttgart in 1886 by Robert Bosch (1861-1942) as “Workshop for Precision Mechanics and Electrical Engineering.”

The special ownership structure of Robert Bosch GmbH guarantees the entrepreneurial freedom of the Bosch Group, making it possible for the company to plan over the long term and to undertake significant up-front investments in the safeguarding of its future. Ninety-two percent of the share capital of Robert Bosch GmbH is held by Robert Bosch Stiftung GmbH, a charitable foundation. The majority of voting rights are held by Robert Bosch Industrietreuhand KG, an industrial trust. The entrepreneurial ownership functions are carried out by the trust. The remaining shares are held by the Bosch family and by Robert Bosch GmbH.

Additional information can be accessed at www.bosch.com.

Source: Bosch Group

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