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The Commercial Vehicles division remains a core business area.
ZF reported sales of €41.4 billion for fiscal year 2024, a decrease of 11% year-over-year. This decline was primarily attributable to the deconsolidation of the axle assembly product line, which had generated €2.6 billion in sales. Excluding this one-time effect, the organic sales decline was approximately 3%. In presenting its 2024 results, ZF states that it continues to implement its strategic reorientation and efficiency programs to improve long-term competitiveness and profitability.
Separately, ZF is evaluating the full spin-off of its Electrified Powertrain Technologies division as part of the "Green" project; this transaction would not affect the Commercial Vehicles division. Last year, the group announced that the number of ZF employees in Germany would be gradually reduced by around 11,000, reaching 14,000 by the end of 2028 within the Electrified Powertrain Technologies division.
Regarding the 2024 results, the group recorded lower volumes in both the passenger car segment and, cyclically, in the commercial vehicle segment.
ZF states that the group remains committed to optimizing its portfolio, focusing on key sectors such as chassis systems, commercial vehicles, and industrial technology, as well as its aftermarket business. These divisions are among the top three in their respective segments. To drive future growth, ZF is actively pursuing collaborations in e-mobility, electronics, and driver assistance systems. This approach seeks to improve market alignment and create a strong ecosystem for the future of mobility.
How did commercial vehicles fare in 2024?
The commercial vehicle segment, like the passenger car business, experienced cyclical volume declines in 2024. However, ZF's Aftermarket division saw organic sales increase by 12% to €3.6 billion. This growth was driven by increased demand for services amid lower new vehicle sales. Regionally, Europe remained the largest source of revenue at 47%, followed by North America (27%) and Asia-Pacific (23%).
Regarding financial results, ZF recorded adjusted EBIT of €1.5 billion, representing a margin of 3.6%, down from 5.1% in 2023. Free cash flow, adjusted for M&A activities, amounted to €305 million. High restructuring provisions of approximately €600 million contributed to a net loss of €1.02 billion, increasing ZF's net debt to €10.5 billion.
With continued economic uncertainty, particularly in the eurozone and Germany, ZF projects sales exceeding €40 billion by 2025. The company forecasts an adjusted EBIT margin of between 3.0% and 4.0% and free cash flow exceeding €500 million.
ZF is reducing its workforce.
ZF CEO Holger Klein emphasizes that Germany will remain a key pillar for ZF in the future, but that it requires a more efficient structure and adaptation of the workforce to the continued expectation of lower market demand. "We are aware that this entails significant staff reductions in some cases. Our goal is to preserve as many jobs as possible and implement the necessary reductions in the most socially acceptable way."
Last year, the workforce in Germany was reduced by approximately 4,000 full-time equivalent (FTE) positions, primarily due to partial retirements, wage fluctuations, the termination of temporary contracts, and the collective reduction of weekly working hours.
As of December 31, 2024, ZF employed 161,631 people worldwide (2023: 168,738), approximately 4% fewer than the previous year. In Germany, the number of employees also decreased nominally by approximately 4%, to 52,027 (2023: 54,447).
