Skip to main content
Sister Publication Links
  • Automotive News
  • Automobilwoche
  • Automotive News Canada
  • Automotive News China
Subscribe
  • Subscribe
  • Newsletters
  • Login
  • HOME
    • Latest news
    • Automakers
    • Suppliers
    • New Product
    • Environment/Emissions
    • Sales By Market
    • On The Move
    • Auto Shows
    • Munich Auto Show
    • Geneva Auto Show
    • Paris Auto Show
    • Beijing Auto Show
    • Shanghai Auto Show
  • Features
    • Long Read
    • Interview of the Month
    • Focus on Electrification
    • Focus on Technology
    • Segment Analysis
    • Cars & Concepts
    • Supplier Spotlight
    • Europe By The Numbers
  • Opinion
    • Blogs
    • Commentary
    • Guest columnists
  • Photos
    • Photo Galleries
    • Geneva Photo Gallery
    • Beijing Photo Gallery
    • Frankfurt Photo Gallery
    • Paris Photo Gallery
    • Shanghai Photo Gallery
  • Podcasts
  • Car Cutaways
  • EVENTS
    • ANE Congress
    • ANE Rising Stars
    • ANE Eurostars
  • More
    • Publishing Partners
    • Social Media
    • Contact Us
    • Media Kit
    • About Us
    • Capgemini: Invent Head on automotive takeaways from CES 2023
    • Capgemini: Securing the industry's future through a radical rethink
    • Capgemini: Succeeding with the automated driving journey through AI
    • Capgemini: The circular economy is spurring new thinking on EV batteries
    • Capgemini: Toyota and Capgemini leaders on how OEMs can handle industry changes and succeed
    • HEXAGON: Plugging into data is the only way to make winning EVs
    • TUV Rheinland: Ideas, services and certifications for smart mobility
    • TUV Rheinland: Testing of automated and autonomous vehicles on test tracks
    • Toyota Europe
    • UFI Filters
    • Facebook
    • Instagram
    • LinkedIn
    • Twitter
MENU
Breadcrumb
  1. Home
  2. Automotive News Europe
December 08, 2017 12:00 AM

ZF CEO's 'reckless' buying spree led to his departure

  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    Some politicians, townspeople and ZF workers in Friedrichshafen are puzzled about why the supplier needs to change. Pictured is ZF's headquarters.

    FRANKFURT -- The departure of ZF Friedrichshafen CEO Stefan Sommer shows that politics and entrepreneurism rarely are a good match. Sommer turned ZF into the world's second-largest supplier with the $12.4 billion acquisition of TRW Automotive, but his global expansion ambitions clashed with the parochial outlook of the trust that runs the company.

    Sommer and Andreas Brand, mayor of ZF's home town of Friedrichshafen, Germany, and chairman of the city-run Zeppelin Foundation that holds 93.8 percent of ZF, have been at odds for months. The source of contention was Sommer's acquisition spree aimed at reducing the supplier's dependence on combustion-engine cars and building up its expertise in components for autonomous and electric vehicles.

    Earlier this year, ZF took a 40 percent stake in German lidar maker Ibeo Automotive. To gain missing expertise for autonomous trucks, ZF made an unsuccessful $515 million bid for Swedish brake systems group Haldex and sought to take over commercial vehicle parts supplier Wabco Holdings.

    Brand blocked the Wabco bid, which he regarded as "reckless," press reports said. ZF's growing debt worried Brand, who demanded that the supplier pump more cash into the city's coffers. In 2016, the foundation received 156 million euros in dividends from the supplier, according to Manager Magazin. A plan to list the supplier on the stock market was the final straw for Brand.

    Sommer, who was named a 2015 Automotive News Europe Eurostar, was annoyed by the political interference and went on the offensive. He needed the "freedom to do what is necessary," he told the Schwaebische Zeitung and the shareholder structure should not restrict the company's future development. "The moment in which, for example, local political considerations from Friedrichshafen determine the corporate strategy, it will become critical," he told the newspaper.

    Sommer's expansion strategy puzzled local people.

    There were signs last month that Sommer was losing the power struggle when ZF Supervisory Board Chairman Giorgio Behr, Sommer's most powerful ally, stepped down on Nov. 29 to be replaced a week later by former Audi and Bentley CEO Franz-Joseph Paefgen.

    'Clocks tick differently'

    Founded in 1915 as Zahnradfabrik (German for Gear Factory) to produce gears for Zeppelin airships, ZF is a well-established supplier of steering mechanisms, axles, gears and transmissions. One focus is eight- and nine-speed transmissions.

    Sommer sought to turn ZF into a company that could produce an entire vehicle chassis with the latest advanced safety features and autonomous driving technology. However, some politicians, townspeople and ZF workers in Friedrichshafen, a small town next to the popular tourist attraction of Lake Constance, were puzzled about why the supplier needed to change.

    Some workers struggled to understand why transmissions for low-cost commercial vehicles in China cannot still be built in their high-wage town and exported halfway around the world. Illustrating the common thinking, one source at the company said sometimes you have to explain that a bus "is not a transport receptacle for a ZF transmission."

    When ZF marked its centenary, local employees didn't want other ZF sites around the globe to celebrate "because only Friedrichshafen turned 100."

    After Sommer's departure was announced on Thursday, a ZF engineer told the local newspaper: "I'm not sure if Stefan Sommer really was the right person because he had a global corporation in mind. In Friedrichshafen, the clocks tick differently."

    That way of thinking has led many to assume Sommer's departure indicates ZF will back away from its ambitious autonomous technology plans. "This assumption is wrong," a ZF spokesman said in an email to Automotive News Europe. "ZF will stay true to its strategy."

    ZF will use next month's CES in Las Vegas and the Detroit auto show to demonstrate how far the company has come with its latest technology. "ZF will continue to transform itself so as to drive the mobility megatrends forward," the spokesman said.

    Sommer's departure, however, leaves a big question mark on how ZF will be able to maintain this momentum and whether the change at the top will let rivals gain an advantage.

    Douglas A. Bolduc contributed to this report

    RECOMMENDED FOR YOU
    2022 Eurostar winner Enrico Salvatori of Qualcomm
    Related Articles
    ZF CEO Sommer steps down after losing power struggle
    ZF remains committed to autonomous vehicles despite CEO's ejection
    Recommended for You
    Enrico Salvatori
    2022 Eurostar winner Enrico Salvatori of Qualcomm
    Christian Dahlheim
    2022 Eurostar winner Christian Dahlheim of VW Financial Services
    Milan Nedeljkovic
    2022 Eurostar winner Milan Nedeljkovic of BMW
    Capgemini Invent Head on automotive takeaways from CES 2023
    Sponsored Content: Capgemini Invent Head on automotive takeaways from CES 2023
    Sign up for free newsletters
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Get Free Newsletters

    Sign up and get the best of Automotive News Europe delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    SUBSCRIBE TODAY

    Get 24/7 access to in-depth, authoritative coverage of the auto industry from a global team of reporters and editors covering the news that’s vital to your business.

    SUBSCRIBE NOW
    Connect with Us
    • Twitter
    • Facebook
    • LinkedIn
    • Instagram

    Founded in 1996, Automotive News Europe is the preferred information source for decision-makers and opinion leaders operating in Europe.

    Contact Us

    1155 Gratiot Avenue
    Detroit MI  48207-2997
    Tel: +1 877-812-1584

    Email Us

    ISSN 2643-6590 (print)
    ISSN 2643-6604 (online)

     

    Resources
    • About us
    • Contact Us
    • Advertise with us
    • Advertise with Us
    • Ad Choices Ad Choices
    • Sitemap
    Awards
    • Rising Stars
    • Eurostars
    • Leading Women
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Automotive News Europe
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • HOME
      • Latest news
      • Automakers
      • Suppliers
      • New Product
      • Environment/Emissions
      • Sales By Market
      • On The Move
      • Auto Shows
        • Munich Auto Show
        • Geneva Auto Show
        • Paris Auto Show
        • Beijing Auto Show
        • Shanghai Auto Show
    • Features
      • Long Read
      • Interview of the Month
      • Focus on Electrification
      • Focus on Technology
      • Segment Analysis
      • Cars & Concepts
      • Supplier Spotlight
      • Europe By The Numbers
    • Opinion
      • Blogs
      • Commentary
      • Guest columnists
    • Photos
      • Photo Galleries
      • Geneva Photo Gallery
      • Beijing Photo Gallery
      • Frankfurt Photo Gallery
      • Paris Photo Gallery
      • Shanghai Photo Gallery
    • Podcasts
    • Car Cutaways
    • EVENTS
      • ANE Congress
      • ANE Rising Stars
      • ANE Eurostars
    • More
      • Publishing Partners
        • Capgemini: Invent Head on automotive takeaways from CES 2023
        • Capgemini: Securing the industry's future through a radical rethink
        • Capgemini: Succeeding with the automated driving journey through AI
        • Capgemini: The circular economy is spurring new thinking on EV batteries
        • Capgemini: Toyota and Capgemini leaders on how OEMs can handle industry changes and succeed
        • HEXAGON: Plugging into data is the only way to make winning EVs
        • TUV Rheinland: Ideas, services and certifications for smart mobility
        • TUV Rheinland: Testing of automated and autonomous vehicles on test tracks
        • Toyota Europe
        • UFI Filters
      • Social Media
        • Facebook
        • Instagram
        • LinkedIn
        • Twitter
      • Contact Us
      • Media Kit
      • About Us