STUTTGART -- The economic stimulus programs in industrial and developing countries will yield results later this year, says Robert Bosch CEO Franz Fehrenbach.
There is a chance that the global economic outlook will stabilize in the second half of the year, he said. Nonetheless, global vehicle production will decline about 10 percent in 2009.
As the worlds largest auto supplier, Bosch is especially affected by the industry crisis in Europe, the United States and Asia.
Bernd Bohr, the head of the companys vehicle technology division, says its automotive business fell 25 percent in the fourth quarter of last year.
He is also hoping for positive effects from the German governments stimulus package. But we will not know for six to eight weeks whether the environmental bonus will lead to rising revenues for us as well, he said.
Its not a problem for Bosch if Germanys scrapping bonus, which pays cash to consumers who sell a car at least 9 years old and buy a new one, favors the purchase of small cars from foreign brands.
In every car made in Europe, there is an average of 800 euros worth of Bosch technology, Bohr said.
Overall, the company fears there will be a painful revenue decline in the first half of the year. It will take great effort to keep our profitability halfway stable at a low level , Fehrenbach said.
Bosch hopes it wont slip into the red despite the worst economic decline in Germanys postwar history.
In view of the uncertainties, Fehrenbach said he didnt feel in a position to make a more precise prediction for 2009. Actually, we dont currently have an approved business plan, he said.
The year 2008 was not very encouraging for the company. After revenues climbed 5 percent in the first half, they fell 2.8 percent to 45 billion euros for the entire year. The greatest decline was in the vehicle business.
Bosch ranks first on the Automotive News Europe list of the top 100 global suppliers with worldwide parts sales to automakers of $36.16 billion in 2007.