The global technology group Freudenberg continued its good business development in 2018 in a volatile and difficult environment and recorded strong organic growth of 4.3 percent in euros over the previ-ous year. The Group increased sales to €9,455 million or CNY 73,897 million in 2018. Freudenberg’s innovative strength is illustrated by the one third of sales (33.6 percent) earned from products less than four years old. The Group’s more than 70 sites in Greater China also performed well in 2018, generating sales of CNY 8.5 billion, a 2.9 percent in-crease compared to a year ago. As a long-term partner to its Chinese customers, Freudenberg increased investment in China last year to nearly CNY 300 million – some 29 percent more than in 2017.
“Our strong strategic and operative planning are the keys to Freudenberg’s success, along with the team spirit of more than 49,000 employees as well as close and agile cooperation with our customers,” said Dr. Mohsen Sohi, CEO of the Freudenberg Group, at the press conference in Beijing.
Innovation: The backbone of Freudenberg’s success
Innovation is the key to Freudenberg’s long-term corporate suc-cess. In the year under review, the Group invested more than ever before in innovation and spent CNY 3,470 million (previ-ous year: CNY 3,275 million, +3.7 percent) on research and de-velopment. This equals 4.7 percent of total sales (previous year: 4.6 percent). The objective of all these activities is to further in-crease the share of sales for new products.
In 2018, an average 3,590 employees (previous year: 3,445 em-ployees) worked in research and development.
Continued investment in local innovations and technology
“This year, Freudenberg celebrates its 170th anniversary, and we proudly look back on over 100 years of partnerships in China. We weathered numerous periods of market volatility in this time. But we were able to reinvent ourselves and respond rapidly to a changing environment, ensuring our long-term growth,” said Dr. Sohi. “We strongly believe in and support the country’s long-term development. Our investment strategy provides clear evi-dence of this commitment, as we continue to expand our pres-ence in this important market,” adds Bettina Schoen-Behanzin, Freudenberg Regional Representative Asia.
Continued investment in high-tech manufacturing infrastruc-ture, local R&D facilities and new acquisitions are integral to the Group’s long-term approach and innovation strategy in China. Overall investment in Greater China amounted to almost CNY 300 million in 2018, up nearly 29 percent compared to 2017.
The large investments in state-of-the-art production facilities in-clude a new factory in Chongqing for Vibracoustic. The plant will produce NVH (Noise, Vibration, Harshness) solutions for automotive customers. NOK-Freudenberg (China) is also build-ing a new facility in Changchun for sealing products. Two new lines are under construction in Suzhou and Taiwan, which will produce components for the automotive interior and apparel businesses. In March 2019 Freudenberg Performance Materials started up a new production line for high-quality car headliners in Suzhou.
More than half of Freudenberg sites in China have their own on-site R&D. “We are aware of the strength of China’s R&D cul-ture and invested nearly CNY 204 million in our local R&D activ-ities last year,” said Schoen-Behanzin.
The Group’s latest investment underscores Freudenberg’s long-term commitment to China. At the end of March, Freudenberg Filtration Technologies finalized the acquisition of a 75 percent majority stake in Foshan City’s Apollo Air-Cleaner Co., Ltd., a leading supplier of air and water filtration solutions in China. The new joint venture, Freudenberg Apollo Filtration Technolo-gies, began operations in April, strengthening the Group’s posi-tion in China’s rapidly growing market for filtration solutions.
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