Damme (April 27, 2018). The automotive supplier BOGE Rubber & Plastics achieved the highest sales in the company's history in the 2017 financial year. It grew by 8.6 percent to 829.2 million euros. Adjusted for exchange-rate effects, sales growth even amounted to 9.7%. On the one hand, growth was driven by the good order situation across all product lines, a large number of product launches, and disproportionate growth in China.
With the new plant in Mexico and the second plant in China, the supplier of vibration control and plastics solutions continued its international expansion course in 2017. In addition, the product portfolio is being continually expanded. Dr. Torsten Bremer, CEO of BOGE Rubber & Plastics, presented at the annual press conference at the company headquarters in Damme, Lower Saxony on Friday (April 27), Fiber-reinforced rubber-elastic coupling -- the latest product from BOGE.
The expansion of the product portfolio by the Fiber-reinforced rubber-elastic coupling has become possible because the BOGE Rubber & Plastics Group acquired the fixed assets and patent utility rights of Flexcon Germany GmbH in Mühldorf as of April 1, 2018. Flexcon Germany GmbH develops, produces and sells Fiber-reinforced rubber-elastic coupling such as those used in cardan shafts of rear and four-wheel drive motor vehicles as well as in many mobile and stationary industrial areas. The development and low volume production location of Flexcon-Germany GmbH in the Bavarian town of Mühldorf will be continued under the umbrella of BOGE Elastmetall GmbH. "The development expertise of Flexcon Germany GmbH ideally complements our international production presence. Thanks to this new product area, the overall program in the core area of vibration technology from BOGE Rubber & Plastics is excellently rounded off, "emphasized Dr. Bremer. In the medium term, the BOGE Rubber & Plastics Group aims to generate sales in the double-digit million euro range per year with the Fiber-reinforced rubber-elastic coupling.
In addition to this strategic portfolio expansion in the field of vibration technology, new product areas in the product line plastics support the expansion strategy. Lightweight components are increasingly applied in new vehicle design applications, in which the BOGE Rubber & Plastics Group participates disproportionately.
Innovation culture – the driver of competitiveness
Dr. Bremer sees innovation culture as a key success factor associated with a clear focus on innovations for the automotive industry as well as for other industries: "To be more competitive, we have to become more agile and always aim to strive for constant improvement," says Dr. Bremer: "The challenge is to guarantee a high level of product quality and operational excellence throughout the world. With the innovation process initiated, we want to accelerate our innovative strength in terms of products as well as processes and materials. In addition to the demand for alternative vehicle drives, our acoustic design expertise and lightweight construction play a key role. Not least, the various innovation awards we have won in recent years bring further motivation to the entire team as they confirm quite clearly that the course we have taken is the right one which is also reflected in the market. "
To consolidate its position as a leader in technology and innovation, the BOGE Rubber & Plastics Group invested more than EUR 50.7 million in the 2017 financial year - more than five percent of total sales. "For our internationalization and growth course, we still have the full support of our Chinese owner," said Dr. Bremer.
With an investment volume of EUR 19.1 million, Germany ranked first in the 2017 financial year, followed by China (EUR 17.4 million) and Slovakia (EUR 10.8 million). Among the major investment projects at the Damme location were the plastic pedal modules (MQB platform, VW) and at the Simmern (Hunsrück) location, the MLBevo engine mount system for Audi (second generation Modular Longitudinal Toolkit) and the transmission mount for VW (platform MQB, A0). Major investment projects outside of Germany involved various elastomeric chassis mounts for the customer Daimler (platform MFA 2) in Trnava (Slovakia) and the plastic pedal modules for various vehicle models of the Volkswagen Group in Qingpu (China).
Internationalization 2017: New plant in Mexico and second plant in China
Another important step in expanding the global presence was the opening of the plant in Mexico. In San Luis Potosí projects for all product lines in particular in the field of vibration control for chassis and powertrain suspension systems as well as plastic components and modules are realized. Among the first customers are Daimler and the VW Group. In the medium term, around 200 employees will work for BOGE in Mexico.
With "BOGE Rubber & Plastics Zhuzhou Co. Ltd.", BOGE Rubber & Plastics now has a second plant in China. The Automotive Division of the owner Zhuzhou Times New Material Technology Co., Ltd. (TMT) has been integrated into the BOGE Rubber & Plastics Group. The BOGE plant in Zhuzhou focuses on automotive vibration control products and acoustic isolation components. Thus, BOGE has extended its product portfolio by acoustic products (passive insulation materials) for the automotive industry and industrial applications as well as truck chassis modules. Around 200 employees in Zhuzhou mainly produce products for customers in the truck and bus sector.
Western Europe and China are the most important markets
The analysis of sales by region shows that Western Europe remains the most important market for the global supplier of vibration control and plastics solutions in the automotive industry. In 2017, about 50 percent of Group sales were generated in this region, followed by China, already with a share of over 20 percent, Slovakia with around 15 percent and the United States with around 12 percent.
In financial year 2017, BOGE Rubber & Plastics employed an average of 4,183 people (previous year: 3,765 employees). The increase resulted mainly from the new plants in Mexico and China. Most employees are employed in Germany (about 1,800), followed by China (about 1,000), Slovakia (about 900) and the USA (about 250).
The BOGE Rubber & Plastics Group will continue its internationalization strategy in the coming years as well. Significant first ramp-ups at the new plant in Mexico will take place in 2018 and 2019. "In order to be able to continue to cope with the strong market growth of the automotive market in China and our customers, we will increase our market presence in China and the foundation stone has already been laid for a third factory," informed Dr. Bremer. The start of production in Wuxi, China is scheduled for 2019. This production capacity is expected to generate an annual sales increase of approximately EUR 100 million. This would increase BOGE Rubber & Plastics' total sales in China to over € 250 million a year.
The BOGE Rubber & Plastics Group wants to continue its growth course and therefore invests continuously. The planned investment level of EUR 48.2 million in 2018 will remain stable, with around EUR 18.5 million flowing to the Chinese locations, EUR 15.4 million to the Trnava (Slovakia) plant and EUR 10.0 million to Germany, of which 6.7 million euros to the Damme location. The significant investments in China and Slovakia also reflect the fact that, in the global automotive market, more than ever, the competitiveness of products plays a significant role in the supplier decisions of globally-purchasing automobile manufacturers in addition to technology expertise. Dr. Bremer: "BOGE Rubber & Plastics is ready to face these challenges in order to be able to grow faster than the market in the future."