The pandemic has brought the global auto industry, which was already suffering a slowdown since 2018, to a complete standstill and the recovery will take at least four to five years, said Bosch on May 22.
Bosch Ltd. managing director Soumitra Bhattacharya said the industry had regressed by three to four years due to the slowdown in the economy and COVID-19 had further pushed it back by 1.5 to 2 years. The whole industry has been affected, and we are not an exception. The recovery will take long time, he said.
Mobility currently accounts for 80% of the companys revenues. We are affected, short-term, with all four segments of the automobile industry having shown decline. However, the long-term outlook seems good and we will bounce back. We are confident of growing our share further in the mobility space also. Overall, we target to growth faster than the industry, he said.
Bosch reported a 24% decline in its mobility business in 2019-20. Its domestic sales declined by 26% and export declined by 6%. Within the mobility segment, the electric powertrain solutions business too declined by 30% due to slowdown in the automotive sector. Companys other businesses declined 14%.
Boschs March 31 ended quarter revenues were down at 18% to 2,236 crore while profit plunged 80% to 81 crore. The decline is due to the reduced turnover following market slowdown and the impact of the coronavirus pandemic during the last few days of the quarter, said the company.
For the full year, operating revenue was also down by 18.1% to 9,841 crore while profit was 684 crore, down from 1,692 crore a year earlier.
Going forward, there would be a lot of focus on digital-technology-driven innovations, as per Mr. Bhattacharya. Connected mobility is a growing segment. Battery, energy and sensors are interesting spaces. Artificial intelligene and internet of things are the areas where we will have more focus on.
Bosch said it would not operate its factories at full capacity until some amount of recovery was established. We will assess the market needs and operate our shifts. All non-essential expenditure have been put on hold with the company preparing to push all its investments into future projects like electrification.
Mr. Bhattacharya further said, there was no direct stimulus for the auto industry in the package the government recently annonced. Recovery depends on some direct stimulus, relaxation in GST and clearance of the scrap policy. Money in the system can quickly revive demand in the market.
India is the second largest research and development base for mutinational engineering and technology firm Bosch, outside of its headquarters in Gerlingen, Germany. It currently has over 31,500 employees in India, including 18,000 engineers. In 2022, Bosch will have completed 100 years of its presence in India.