ZF Friedrichshafen, best known for its transmissions, has quietly become a force in high-voltage electrification. It has done so by building on its expertise in electrified gearboxes for plug-in hybrids, which already have electric motors and power electronics. More important, this new business will more than compensate for an expected decline in combustion-based drivetrain components, ZF says. Automotive News Europe Managing Editor Douglas A. Bolduc and News Editor Peter Sigal recently spoke with Stephan von Schuckmann, the ZF board member responsible for electric powertrains, about how the supplier is navigating this fundamental shift.
How hard was it to transform ZF from a driveline specialist to an expert in electric mobility?
We have been in the electrification business for quite a few years, but a lot of people don’t know that because we have traditionally been a transmission supplier. One example to explain why this transformation was possible is our well-known 8HP transmission, which we are now industrializing the fourth generation of. This has been electrified for years for mild hybrid and plug-in hybrid applications. In the front of the transmission is an electric motor; we also have expertise in power electronics. So, if you take the mechanical side of the transmission, and you dramatically reduce it, and you enlarge the electric motor and leave the high-voltage power electronics -- that is what you would call an electric powertrain today. The transformation is challenging from a product perspective, but it’s something we have been working on for years.
ZF’s CEO, Wolf-Henning Scheider, says he anticipates that by the end of the 2030s ZF will be only supplying full-electric vehicles. How is that changing your business?
A year and a half ago we stopped the development of all applications that are directly linked to the internal-combustion engine. At this point, we are purely focused on developing products for vehicles with electric powertrains. We are busy closing our last (combustion-only) transmission project; most of our engineers are already working on e-mobility. When it comes to plants, our traditional transmission plants are still fully utilized; they deliver to global markets, where the shift to electric mobility is moving at different speeds. They will be filled up with orders through roughly 2025. After that we expect a gradual decline in the traditional [nonhybrid] transmission business. We have an order pipeline of roughtly 25 billion euros for high-voltage electric mobility [plug-in hybrids and full-electric]. With a bit of growth, we will compensate for the downturn in combustion drivetrains. Of course, it not easy. You have to reskill people and you have to keep everyone motivated, but it's manageable from our perspective.
How are you reconfiguring your factory network?
Our big plants in Saarbrucken [Germany] and Gray Court [in the U.S. state of South Carolina] are in the midst of transformation. They are taking a lead role in that transformation, which means they will industrialize certain projects first; for example, Saabrucken is leading in powertrain systems; Schweinfurt [Germany], with more than 9,000 employees, will take the lead in components for electric motors; Auerbach [Germany] takes the lead for power electronics. We are also building new plants. We just built a plant in Shenyang [China], for three customers, where we will be producting powertrain systems and electric motors. We will be building a high-voltage power electronics plant in Mexico, and we are building a similar factory in Serbia. In parallel we are digitizing our plants and making them more sustainable.