OREANDA-NEWS. In 2015, Bosch increased its sales in China to 11.1 billion euros. Despite a less dynamic market environment, the supplier of technology and services achieved a nominal sales growth of some 19 percent. Adjusted for currency effects, sales were up slightly in local currency. Sales in China almost doubled as a result of the full acquisition of the former fifty-fifty joint ventures BSH Hausger?te GmbH and Robert Bosch Automotive Steering GmbH. This makes the country the second-largest market for the Bosch Group after Germany. Over the past three years, China’s share of total Bosch Group sales has increased from nine to 16 percent.

Bosch expects a positive performance in China also for 2016 and sees especially strong potential in the area of connectivity. “The Chinese market continues to offer us a wide range of business opportunities. The market for the internet of things (IoT) is also growing rapidly in China,” said Peter Tyroller, the member of the board of management of Robert Bosch GmbH responsible for Asia Pacific at the local annual press conference in Shanghai. He added that this is above all thanks to the “Internet Plus” initiative for integrating the internet into traditional industries – a major element of the Chinese government’s 13th Five-Year Plan, which aims to make China a greener, more open, more innovative, and more sustainable economy. “Over the coming years, we expect China to see strong growth in demand for quality products as well as for connected solutions and services. Bosch is well positioned for this,” Tyroller said.

“Local for local” in connectivity as well
Bosch has been present in China since 1909 and is committed to localization there. “Our ‘local for local’ strategy in China is paying off, as we can see from our sustained business success in the country,” Tyroller said. This relies on expanding local manufacturing as well as research and development. “We invested more than 750 million euros in China in 2015, and we are budgeting a similar sum for 2016,” he continued. For example, Bosch will open a new plant in Wuhu this year for its Car Multimedia division. Tyroller also sees localization as a recipe for success with connectivity. This is why the Bosch subsidiaries Bosch Software Innovations, Bosch Sensortec, and Bosch Connected Devices and Solutions have been present in the local market for several years. When it comes to connectivity, Bosch also relies on alliances with local partners such as Tencent, one of the biggest Chinese internet companies. This collaboration will enable local use of the mySPIN smartphone integration solution. What is more, a team of research associates in China is developing IoT solutions that are tailored to the local market.

Increased competitiveness in China thanks to Industry 4.0
It is above all in connected industry that Bosch sees huge potential in China. “We expect that the use of intelligent and connected solutions in manufacturing will play an increasingly important role in China,” Tyroller said. The key driver for this is the “Made in China 2025” initiative, which is part of the country’s “Internet Plus” action plan. In China, too, Bosch is pursuing a two-pronged strategy in the area of Industry 4.0: As a leading supplier, the company offers a range of solutions for the Chinese market in the areas of powertrain technology and automation as well as sensor technology and software. And as a leading user of Industry 4.0, Bosch is already operating eight pilot projects at its Chinese manufacturing locations in Suzhou, Shanghai, Wuxi, Changsha, Nanjing, Beijing, Changzhou, and Xi’an. In logistics and inventory, for instance, RFID (radio frequency identification) tags track the route workpieces take through the factory, while reading stations are able to pinpoint the position of the transport crates at any time. It is easy to see what work steps blanks are gradually progressing through and when the products will most likely be finished. That data, in turn, can be used to determine when they will be packaged, shipped, and installed. In the Bosch plant in Suzhou, this has already cut the time needed for inventory by 97 percent, or 440 man-hours.

Bosch is a sought-after software employer in China as well
Connectivity also plays an important role in the search for new talents. In 2015, 30 percent of the 5,000 Bosch researchers and developers in China were working in software development. They will be joined by another 2,500 associates in 2016. Bosch now employs some 55,000 associates in China – 2,000 more than one year ago. This makes the company’s headcount in China the biggest outside Germany.

Asia Pacific as a success story for Bosch
Bosch’s success story in Asia Pacific goes back more than a century. In the past five years alone, the company has achieved average sales growth in the region of some ten percent and invested a total of four billion euros. With a 27 percent share of total sales revenue, Asia Pacific remains an important pillar of growth for the Bosch Group. In 2015, its sales in the region rose 17 percent (2.8 percent after adjusting for exchange-rate effects) to 19.2 billion euros. Today, Bosch has 104,000 associates in 18 countries across the region: in Australia, New Zealand, Bangladesh, China, India, Japan, South Korea, Sri Lanka, and Taiwan, as well as in the ASEAN member states Indonesia, Malaysia, the Philippines, Cambodia, Laos, Myanmar, Singapore, Thailand, and Vietnam.