Brose focuses on China with aim to achieve substantial growth

German auto parts supplier Brose is confident about the Chinese market, expecting its business in the country to account for one-fourth of its global total by 2025, said Ulrich Schrickel, CEO of the company.

Schrickel made the remarks in Shanghai a day before the city's auto show, which runs from Tuesday to April 27.

It is the first time that he has visited China in three years since the outbreak of the COVID-19 pandemic.

"I'm very curious to see everything and it was amazing for me that I saw so many Chinese brands on the road," said Schrickel.

Years ago, most of the taxis in the city were from international brands. But now he sees many of them are domestic ones.

This new finding upon his arrival in Shanghai on Sunday has much to do with his company's business in China.

"I think most of our business (in China) was from international OEMs (original equipment manufacturers) years ago. Now, we have changed that.

"We will have at least one-third (of our local business) from Chinese OEMs by around 2027," he said.

The fast-changing and growing Chinese market is expected to boost Brose's business, which has been growing at 6 percent over the past three years.

In 2023, its turnover in China is expected to reach 1.3 billion euros ($1.42 billion) and the figure will grow to more than 2 billion euros in 2027, Schrickel said.

The company's global turnover is forecast to grow from 7.5 billion euros to more than 10 billion euros in 2025.

To grow its business, Brose is developing customer-oriented smart comfort solutions in China.

He mentioned the example of a back seat structure shown at Brose China. "This is a complete Chinese development done for the local market … we are adapting our products to market requirements," he said.

Besides seats, Schrickel said Brose has been offering various solutions for electric smart vehicles as well.

He gave the example of an 810-volt electric climate compressor for thermal management systems of NEVs that is compatible with fast-charging technology; side doors that can open automatically and its software BRAIN (Brose Access and Interior Network), that can connect and control all comfort functions inside of the car.

"I'm also very curious to hear what customers are telling us about our solutions because at the very end the customer decides," said Schrickel.

He said Brose follows a "local for local" strategy, adding that around 90 percent of its supply chain in China is localized.

"We want to grow with the Chinese market, which is the biggest automotive market in the world," said Schrickel.

Brose invested around 735 million euros between 2013-22 in China, and 370 million euros was made during 2018-22.

"We have 11 facilities in China. We are in all key automotive regions of China with our facilities near to our customers. So we have a quite good setup here," said Schrickel.

He acknowledged the need for traditional suppliers like Brose to be more flexible to grow in the new and competitive market.

"So we have also to reinvent ourselves continuously," said Schrickel. "If you ask me how we are going to do that … (it involves) giving the regions much more freedom to decide. We are on a good way to do that."

lifusheng@chinadaily.com.cn