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The Auto Industry: Roadmap To The Future

The Auto Industry: Roadmap To The Future

As the sector transforms itself, will the automobile keep its soul? Article by Paul Gao, Russell Hensley, and Andreas Zielke, McKinsey & Company.

Over the past 50 years, automobiles have continued to be our “freedom machines”, a means of both transportation and personal expression. Even so, as the industry recognised, the automobile is but one element of a mobility system – an element governed by extensive regulations, constrained by a need for fuel, and dependent on a network of roadways and parking spaces. Automobiles are also a force for change. Over the past half century, their very success has generated pollution and congestion while straining the supply of global resources. The rapid surge of emerging markets has heightened these dynamics.

Even more transformative change is on the way. Global competitive intensity will rise as Chinese players expand from their vast domestic market. Governments are examining the entire automotive value chain and beyond with an eye toward addressing externalities. Technological advances – including interactive safety systems, vehicle connectivity, and, ultimately, self-driving cars – will change the game. The automobile, mechanical to its soul, will need to compete in a digital world, and that will demand new expertise and attract new competitors from outside the industry. As value chains shift and data eclipses horsepower, the industry’s basic business model could be transformed. Indeed, the very concept of cars as autonomous freedom machines may shift markedly over the next 50 years. As mobility systems gain prominence, and vehicles are programmed to drive themselves, can the soul of the car endure? This is just one of the difficult questions that confront the automotive industry as a result of the forces described in this article.

The China Factor

Fifty years of innovations in horsepower, safety, and rider amenities have helped automobile sales grow by an average annual rate of three percent since 1964. This is roughly double the rate of global population growth over the same period and makes for a planet with over one billion vehicles on its roads. For the past 20 years, though, sales in North America, Europe, and Japan have been relatively flat. Growth has come from emerging markets – much of it in China, which over the past decade has seen auto sales almost triple, from slightly less than 8.5 million cars and trucks sold in 2004 to, estimates suggest, about 25 million in 2014. IHS Automotive predicts that more than 30 million vehicles a year will be sold in China by 2020, up from nearly 22 million in 2013.

For decades, Japanese, North American, and European OEMs formed a triad that, at its height, produced an overwhelming majority of the world’s automobiles. The growth of Chinese players is changing the equation – and things are moving fast. Ten years ago, only one Chinese OEM, Shanghai Automotive Industry Corporation, made the Fortune Global 500. The 2014 list has six Chinese automakers. Given surging local demand, the Chinese may just be getting started.

Regulating From ‘Well To Wheels’

Governments have been driving automotive development for decades. Initially, they focused on safety, particularly passive safety. The process started with seat belts and padded dashboards and moved on to airbags, automotive “black boxes,” and rigorous structural standards for crash-worthiness, as well as requirements for emissions and fuel economy.

More recently, the automobile’s success has strained infrastructure and the environment, especially as urbanisation has accelerated. Brown haze, gridlock, and a shortage of parking now affect many urban areas in China, as they do in other cities around the world. Municipalities have begun to push back: Mexico City’s Hoy No Circula (“no-drive days”) programme uses the license-plate numbers of vehicles to ration the number of days when they may be used, and dozens of cities across Europe have already established low-emission zones to restrict vehicles with internal-combustion engines.

China too is acting. Influenced by its dependence on foreign oil and by urban-pollution concerns, the government has indicated that it favours electric vehicles, even though burning domestic coal to power them can leave a larger carbon footprint. In Beijing, a driver wishing to purchase a vehicle with an internal-combustion engine must first enter a lottery and can wait two years before receiving a license plate. Licenses are much easier to get for people who buy state-approved electric vehicles.

Regulation would also create new opportunities beyond traditional industry competencies. For example, some automakers are investigating potential plays across the value chain – such as developing alternative fuels or investing in wind farms to generate power for electric vehicles – to offset the emissions created by the vehicles they sell.

In any event, the automotive industry should expect to remain under regulatory scrutiny, and future emissions standards will probably require OEMs to adopt some form of electrified vehicle. Indeed, we believe that regulatory pressures, technology advances, and the preferences of many consumers make the end of the internal-combustion engine’s dominance more a matter of “when” than of “if”. The interplay of those forces will ultimately determine whether range-extended electric vehicles, battery electric vehicles, or fuel-cell electric vehicles prevail.

Digital Disruption

The car of the future will be connected – able not only to monitor, in real time, its own working parts and the safety of conditions around it but also to communicate with other vehicles and with an increasingly intelligent roadway infrastructure. These features will be must-haves for all cars, which will become less like metal boxes and more like integrators of multiple technologies, productive data centres – and, ultimately, components of a larger mobility network. As every vehicle becomes a source for receiving and transmitting bits of information over millions of iterations, safety and efficiency should improve and automakers should be in a position to capture valuable data. Electronic innovations have accounted for the overwhelming majority of advances in modern vehicles. Today’s average high-end car has roughly seven times more code than a Boeing 787.

Digital technology augurs change for the industry’s economic model. Over the past decades, automakers have poured their cost savings into mechanical, performance-oriented features, such as horsepower and gadgetry, that allow for higher returns. While it’s unlikely that regulatory and competitive pressures will abate, the shift from mechanical to solid-state systems will create new opportunities to improve the automakers’ economics. The ability to analyse real-time road data should improve the efficacy of sales and marketing. Digital design and manufacturing can raise productivity in a dramatic way: big data simulations and virtual modelling can lower development costs and speed up time to market. That should resonate with customers conditioned to the innovation clock speed of consumer electronics, such as smartphones.

Common online platforms can connect supply and demand globally to increase the efficiency of players across the supply chain. Embedded data sensors should enable more precise monitoring of the performance of vehicles and components, suggesting new opportunities for lean-manufacturing techniques to eliminate anything customers don’t value and dovetailing with the digitisation of operations to boost productivity, including the productivity of suppliers, in unexpected ways. As automobiles become more digitally enabled, expect connected services to flourish. When the demands of driving are lifted, even the interiors of vehicles may give automakers opportunities to generate revenue from the occupants’ connectivity and car time.

Autonomous Vehicles And The Soul Of The Car

Currently, human error contributes to about 90 percent of all accidents, but autonomous vehicles programmed not to crash are on the horizon. To be sure, some technological issues remain, emissions issues will linger, and regulators are sure to have a say. Furthermore, combining autonomous and non-autonomous vehicles in a single traffic mix will be a significant challenge. The most difficult time is likely to be the transition period, while both kinds of cars learn to share the road before self-driving ones predominate. The technology, though, is no longer science fiction.

The possible benefits, by contrast, read like fantasy. If we imagine cars programmed to avoid a crash – indeed, programmed never to crash – we envision radical change. Passengers, responsible only for choosing the destination, would have the freedom to do what they please in a vehicle. Disabled, elderly, and visually impaired people would enjoy much greater mobility. Throughput on roads and highways would be continually optimised, easing congestion and shortening commuting times.

Freed from safety considerations such as crumple zones, bumpers, and air bags, OEMs could significantly simplify the production of cars, which would become considerably lighter and therefore less expensive to buy and run. Automobiles could also last longer as collisions stop happening and built-in sensors facilitate the creation of parts on demand.

But what about the soul of the car: its ability to provide autonomy and a sense of self-directed freedom? Google’s prototype autonomous vehicle has no steering wheel, brake pedal, or accelerator. The vision of a connected car, in fact, challenges even the most essential concepts of personal car ownership and control. When a rider need only speak a destination, what becomes of the driving experience—indeed, why even purchase a car at all? Manufacturers may continue to refine the feel of the ride and to enhance cabin infotainment. Still, there’s probably a limit to how “special” a cabin can be or even to how special consumers would want it to be.

 

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Impact Of The US-China Trade War On Vietnam’s Manufacturing Sector

Impact Of The US-China Trade War On Vietnam’s Manufacturing Sector

In 2018, disbursement of FDI projects in Vietnam reached a record high of USD 19.1 billion, showing the high confidence of foreign investors in Vietnam’s business and investment environments. This is an increase of 9.1 percent year-on-year amid global concerns over the tension caused by the US China Trade War. Additionally, the rapid growth of both privately and state run enterprises such as Vingroup or Viettel is an indication of Vietnam’s economy prosperity and the fact that the country’s business environment is capable of nourishing large corporations of global scale.

However, as tensions over the Trade War continue to escalate in 2019, uncertainly over the status of the global manufacturing sector has continued to plague the industry and much attention has been focused on Vietnam due to the country’s status as an emerging manufacturing hub. Currently, the Trump administration has imposed tariffs on USD 250 billion worth of Chinese imports while China has retaliated by imposing tariffs on a cumulative value of USD 110 billion worth of US imports.

In short-term, Vietnam is projected to capture some of China’s global market share in labour-intensive manufacturing, although, in the long-term it is uncertain if Vietnam will continue to benefit from the displacement of manufacturing from China. This is because, Vietnam could face the risk of trade frauds as China looks to route US-bound products through the country to evade existing tariffs at an increasing pace. Furthermore, there is also the risk of Chinese products saturating the Vietnamese market, resulting in increased competition with domestic producers.

Thus, as the trade war drags on, experts have advised Vietnam to develop a new development strategy to evade potential risks. This is also due to the fact that global investors are starting to withdraw their investments from emerging markets, including Vietnam.

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US-China Trade War Continues To Negatively Impact Global Manufacturing

US-China Trade War Continues To Negatively Impact Global Manufacturing

The Trade War is continuing to impact the global manufacturing sector as Malaysian manufacturing slowed to its weakest pace of expansion since the IHS Markit survey began in 2012, and Taiwan’s manufacturing sector fell to its lowest growth since September 2015. While South Korea’s industry, which is heavily focused on tech production, also witnessed a shrinkage in manufacturing activities due to the impact of the US-China Trade War on chip and smartphone orders. Meanwhile, official economic data from Singapore showed that the country’s gross domestic product grew more slowly than forecast in the fourth quarter as the city-state’s manufacturing contracted on a quarterly basis.

In China, the Caixin/IHS Markit PMI slipped into the contraction territory for the first time in 19 months and manufacturing activity in Europe witnessed a stagnating growth towards the end of 2018, with Italy, France, Germany, Spain and Britain experiencing contractions. For Britain, factories are ramping up on stockpiling as possible border delays may occur following Britain’s exit from the EU in three months time. Although the US has experienced a decreased growth, the manufacturing sector is still expanding and this signals that China is suffering more from the Trade War than the US.

Overall, 2019 saw world shares start on a downbeat note with oil prices and bond yields experiencing a downturn as the factory survey data confirmed the picture of a global economic slowdown. In a key annual conference last December, China’s top leaders have mentioned that the government will support the Chinese economy in 2019 through cutting taxes and keeping liquidity ample, as they continue with their negotiations with Washington.

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Worldwide Spending On Robotics And Drones To Reach USD115.7 Billion In 2019

Worldwide Spending On Robotics And Drones To Reach USD115.7 Billion In 2019

A new update to the International Data Corporation (IDC) Worldwide Semiannual Robotics and Drones Spending Guide forecasts that worldwide spending on robotics systems and drones will total USD115.7 billion in 2019, an increase of 17.6 percent compared to 2018. By 2022, IDC expects this spending will reach USD 210.3 billion with a compound annual growth rate (CAGR) of 20.2 percent.

Robotics systems will be the larger of the two categories throughout the five-year forecast period with worldwide robotics spending forecast to be USD 103.4 billion in 2019. Investments in drones will total USD 12.3 billion in 2019 but are forecast to grow at a faster rate (30.6 percent CAGR) than robotics systems (18.9 percent CAGR).

Robotics spending in 2019 will be dominated by hardware purchases, with nearly two thirds of all spending going toward robotic systems, after-market robotics hardware, and system hardware. Purchases of industrial robots and service robots will deliver nearly 30 percent of the category total in 2019. Robotics-related software spending will largely go toward purchases of command and control applications and robotics-specific applications. Services spending will be spread across several segments, including systems integration, application management, and hardware deployment and support. Software spending is forecast to grow at a slightly faster rate (21.7 percent CAGR) than services or hardware spending (19.0 percent CAGR and 18.2 percent CAGR respectively).

Discrete manufacturing will be responsible for nearly half of all robotics systems spending worldwide in 2019, generating USD 50.2 billion in revenues. The next largest industries for robotics systems will be process manufacturing, resource industries, healthcare, and consumers. The industries that will see the fastest growth in robotics spending over the 2017-2022 forecast are wholesale (31.4 percent CAGR), retail (29.6 percent CAGR), and construction (28.1 percent CAGR). By 2022, IDC expects retail will overtake consumer spending on robotics systems.

“Industrial robotics continues to top the technology investment priorities of manufacturing organisations across all major markets surveyed by IDC in 2018,” said Dr. Jing Bing Zhang, Research Director, Worldwide Robotics. “While the looming trade war between the United States and China is likely to dampen the market growth slightly in the near term, we expect the growth trend to pick up from 2020 onward.”

“The worldwide market for commercial service robotics will continue to grow at a rate of 20% per year for the coming five years,” said John Santagate, Research Director for Commercial Service Robotics at IDC. “This growth is due to continued innovation in ease of use as well as the drive for flexible automation across industries. We expect to see growth driven by increased adoption of autonomous mobile robots and collaborative robots being deployed as a means to deliver improvements in capacity, productivity, and efficiency.”

Spending on drones will also be dominated by hardware purchases with roughly 90 percent of the category total going toward drones and after-market drone hardware. Consumer drones will account for roughly 40 percent of the category total in 2019 with service drones delivering another 18 percent. Similar to robotics systems, drone software spending will primarily go to command and control applications and drone-specific applications. Services spending will be led by education and training and will see the fastest growth (35.9 percent CAGR) over the five-year forecast, followed by software (33.9 percent CAGR) and hardware (301 percent CAGR).

Consumer spending on drones will total USD 5.1 billion in 2019, accounting for a little over 40 percent of the worldwide total. Industry spending on drones in 2019 will be led by utilities (USD 1.4 billion), construction (USD 1.05 billion) and discrete manufacturing (USD 913 million). The industries that will experience the fastest growth in drone spending over the five-year forecast period will be federal/central government (56.0 percent CAGR), education (51.0 percent CAGR), and retail (42.01 percent CAGR). By 2022, IDC expects the resource industry to move ahead of both construction and discrete manufacturing to become the second largest industry for drone spending.

“The market is working to simplify the use and integration of drones with efforts ranging from enabling new drone applications through improved technological capabilities to understanding the regulatory implications of drones and the viability of these applications. Drones are developing new skills, coupling 3D mapping and fully autonomous navigation capabilities with rapid improvements in battery performance and air-traffic management systems. Drone adopters continue to search for a safe, cost-efficient, and repeatable drone solution that can be easily implemented in a variety of situations and use cases,” said Stacey Soohoo, Research Manager, Customer Insights & Analysis at IDC.

 

Worldwide Spending On Robotics And Drones To Reach USD115.7 Billion In 2019

On a geographic basis, China will be the largest region for drones and robotics systems with overall spending of $38.5 billion in 2019. Asia/Pacific (excluding Japan and China) (APeJC) will be the second largest region with $23.3 billion in spending, followed by the United States ($17.2 billion) and Western Europe ($13.0 billion). China will also be the leading region for robotics systems with $36.1 billion in spending this year. The United States will be the largest region for drones in 2019 at $4.8 billion. China will deliver the fastest spending growth in both categories with a five-year CAGR of 24.6% for robotics systems and 63.5% for drones.

The Worldwide Semiannual Robotics and Drones Spending Guide quantifies the robotics and drone opportunities from a region, industry, use case, and technology perspective. Spending data is available for more than 60 use cases across 20 industries in nine regions. Data is also available for 18 robotics systems technologies and 16 drone systems technologies. Unlike any other research in the industry, the detailed segmentation and timely, global data is designed to help suppliers targeting the market to identify market opportunities and execute an effective strategy.

 

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Vietnam To Reduce Dependency On Chinese Steel

Vietnam To Reduce Dependency On Chinese Steel

HANOI, VIETNAM: Driven by rising steel demands and economic growth, Vietnam is looking to reduce its dependency on Chinese steel. This is evidenced as two of the country’s largest steelmakers look set to embark on multibillion-dollar capacity investments within the country.

In fact, Hoa Sen Group intends to spend $10 billion on production facilities in southern Vietnam’s Ninh Thuan province in order to capitalise on the area’s deep water ports to import raw materials and export its manufactured steel products. Although the company has yet to reveal the details of its new manufacturing facilities in Ninh Thuan, construction is scheduled to occur in 2019, with operations beginning in 2019. Hoa Sen’s new facility would possess a blast furnace, which is a tool that Vietnam still lacks, and would boost an additional capacity that would more than quadruple total outputs to 16 million tons a year in 2031.

Meanwhile, Hoa Phat Group, intends to build a $2.7 billion steelworks in the Dung Quat Economic Zone of Quang Ngai Province and aims to begin operations in 2020. This facility is projected to increase the company’s annual capacity to 4 million tons which would lift the group total by 130 percent. At the same time, the company will be developing a $170 million steel plate mill in Hung Yen Province, which is close to the Dung Quat facility. Scheduled to begin production in 2018, this facility will provide materials for construction projects in Hanoi – one of the country’s biggest markets for architectural steel besides Ho Chi Minh City.

Currently, imports fulfil about 60 percent of local steel demands, with figures increasing to 33 percent in 2017 to reach 15.7 million tons – 61 percent of which came from China. However, inflows of cheap steel, driven by Chinese overcapacity, have increased so rapidly Vietnamese “safeguard” tariffs have been developed in certain situations. This combined with rising tensions over competing territorial claims in the South China Sea, has spurred Vietnam’s government to drive initiatives that are aimed at reducing dependence on Chinese steel. Additionally, Vietnam holds considerable promise as a steel market as the per-capita steel consumption is just below 300kg, which is recongised as a tipping point whereby demand will greatly increase according to industry insiders.

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[TMTS 2018] Interview With Mr. Zachary Tsai, Vice General Manager Of Campro Precision Machinery Co. Ltd.

[TMTS 2018] Interview With Mr. Zachary Tsai, Vice General Manager Of Campro Precision Machinery Co. Ltd.

Asia Pacific Metalworking Equipment News is pleased to conduct an interview with Mr. Zachary Tsai, Vice General Manager of Campro Precision Machinery Co. Ltd. regarding his views on the current and future market outlook for Taiwan’s metalworking industry.

1.What has been the business focus of Campro in 2018?

For 2018, the company is focusing on machinery as well as machine centres that boost both horizontal and 5 axis features. In terms of the company’s key markets, China and the US are our main markets and the company currently has a manufacturing plant in China that provides machines for the local market, while in the US we have a warehouse for our products.

2. What would be the company’s business focus in 2019?

In 2019, new products that feature flexible manufacturing, IoT and 5 axis machinery will be highlighted but the main markets that the company will be focussing on will remain the same as 2018 (China and the US).

3. What do you think will be the trends in Taiwan’s metalworking industry in 2019?

There will be market changes in 2019 as industries in China, Taiwan and the US might experience a downturn. Although in Taiwan, this will not be the first time that the industry has been affected negatively so the industry would be able to adapt and overcome potential future downturns.

4. What are your views on the Taiwan International Machine Tool Show (TMTS) 2018?

This show is important for Taiwan and it is especially significant to Taichung. Moving forward, the show can focus more on hardware and manufacturing.

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[TMTS 2018] Interview With Mr. Ryan Liu From CNC-Takang

[TMTS 2018] Interview With Mr. Ryan Liu From CNC-Takang

Asia Pacific Metalworking Equipment News is pleased to conduct an interview with Mr. Ryan Liu from CNC-Takang regarding his views on the current and future market outlook for Taiwan’s metalworking industry.

Mr. Ryan Liu from CNC-Takang

1.What has been the business focus of CNC-Takang in 2018?

Originally, the company’s main markets are in Russia, India and Western Europe such as Germany. However, the company is now shifting its focus to the US and the Southeast Asian market due predominantly to currency challenges in other markets. The company also has an office in the US as strong service standards are required in order to meet market demands as well as the country’s strict regulatory requirements. Similarly, in order to meet the quality standards in our markets in the US and Europe, our products have been certified to be able to meet DIN standards.

2. What would be the company’s business focus in 2019?

As the US economy is growing, the US market will be an area of focus in 2019. This is also because the Taiwanese market is currently experiencing limitations due to the policies by the Chinese government and local manufacturers will require more support from the Taiwanese government as well as the establishment of more trade agreements if they were to invest their growth in the local market. In the meantime, other markets that are of interest to the company are Vietnam and Thailand as both countries are experiencing growth in their economies.

3. What do you think will be the trends in Taiwan’s metalworking industry in 2019?

Due to the ongoing trade war, the Taiwanese manufacturing industry will experience a downturn at least till the first quarter of 2019. This is also because the larger Taiwanese manufacturers have factories in China and at least 30 percent of their exports are being produced from their factories in China.

4. What are your views on the Taiwan International Machine Tool Show (TMTS) 2018?

The show has improved every year and the location of the show in Taichung is optimal as 90 percent of the local machine building industry and its associated supporting industries are located here.

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Tornos Launches Customer Service Centre In Shanghai

Tornos Launches Customer Service Centre In Shanghai

Tornos Shanghai has officially opened its new customer centre in Shanghai’s Pudong Pilot Free-Trade Zone. This is in recognition of China’s status as the largest industrial market globally. The new centre will accommodate the company’s full range of machines and brings Swiss operational excellence to the doorsteps of customers in Greater China.

The inauguration of the new customer centre in Shanghai also underscores the power of three legendary entities—Tornos, Switzerland and Shanghai—Turning Together toward the future. Present for many years in China, Tornos inaugurated its first subsidiary in Shanghai in 2004. For both Tornos and Shanghai, the past 14 years have been an amazing journey and the Tornos’ customer centre in Shanghai will strengthen the company’s regional presence and fortify its standing as the partner of choice in machine tools.

Tornos, China And Switzerland: A History Of Collaboration

This year, Tornos also celebrates the fifth anniversary of its Tornos Xi’an plant. And with internationalisation as a top priority, Tornos is strengthening its flexibility and growing through innovation to enhance its operational excellence every day. With the opening of its customer centre in Shanghai, Tornos ramps up its offering of unique solutions for targeted market segments – an approach that has met success in Greater China.

And there is more to come: Tornos plans on increasing its visibility in this market region, and the customer centre in Shanghai will play a big part in this strategy. In fact, this centre is a clear sign of Tornos’ commitment to this market and to its customers.

The new centre is equipped with the latest technologies and will provide quality support to Chinese customers. With a surface area of more than 1,500 square meters, it includes a training center, showroom, metrology room and a stock of spare parts.

In terms of applications, the centre will make full use of Tornos’ know-how across a wide range of industrial segments—including automotive, micromechanics, electronics and medical & dental—with the goal providing turnkey machining solutions while being close to the market. The purpose of this technology center is to maximise support for Tornos’ customers in the production of parts in small or large quantities in China. This support ranges machine support and operator training to the supply of spare parts, technical assistance and programming advice, as well as expertise on the best choice of tools and clamping devices.

Close To Customers, Wherever They Are In The World

Thanks to its new center in Shanghai, Tornos will be faster, more efficient, more responsive to its local customers as this enables the company’s technicians to expedite machine set ups and partnerships with customers. An open house for the customer centre in Shanghai will occur on November 8.

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Siemens Mobility To Develop China’s Intelligent Infrastructure

Siemens Mobility To Develop China’s Intelligent Infrastructure

Siemens Mobility was recently awarded the fully automated CBTC system for two key Chinese metro lines in Eastern China: Suzhou Metro Line 5 and Nanjing Metro Line 7. The cities, which collectively have more than 12 million residents, are two of the largest cities in the region. China’s rapid urbanisation in both cities requires fast and intelligent planning of transportation systems that will ease congestion and provide passengers a more reliable and efficient commute. Initial operations for both lines are planned for 2021.

“We’re committed to delivering intelligent infrastructure projects that enhance passenger experience. Suzhou Metro Line 5 and Nanjing Metro Line 7 projects exemplify China’s commitment to innovative transportation solutions. With Siemens Mobility’s fully automated signaling system Trainguard MT, the country’s mass transit systems will be able to handle the passenger demands of tomorrow,” stated Michael Peter, CEO of Siemens Mobility.

The Suzhou Metro Line 5 is 44.1km long and stretches across 34 stations connecting the east of the city to the west. The line will connect key industrial areas as well as the old town, Gusu District. The line is an important element of the city’s urban planning, easing congestion and connecting new and historic urban areas. The metro currently has three metro lines in operation, serving more than 1.1 million riders a day, with a plan to add an additional four new lines, including Line 5.

With a daily ridership of more than four million, Nanjing Metro is the fourth largest metro system within China. Nanjing Metro Line 7 connects about 35km and 27 stations running parallel to the Yangtze River in a southwestern direction, across the Qixia District, Gulou District, Jianye District and Yuhuatai District. Upon completion, it will effectively ease the traffic pressure in the urban center, protect the ancient city’s landscape and promote Nanjing’s sustainable development.

Siemens Mobility has provided advanced CBTC systems for 26 lines in 17 cities of more than 13 countries, reaching a total mileage of more than 1,800 kilometers. For more than 30 years, Siemens Mobility’s CBTC systems have guaranteed their smooth operation effectively. Apart from securing the train’s automated operation and serving mass transit lines with large capacity, CBTC also makes the operation more efficient and sustainable.

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Trumpf Records Most Successful Year In The Company’s History

Trumpf Records Most Successful Year In The Company’s History

GERMANY: The Trumpf Group was able to significantly increase sales, orders received, and profits in the 2017/18 fiscal year that ended in June 30, 2018. Sales rose by 14.6 percent to 3.57 billion euros from 3.11 billion euros in fiscal year 2016/17. This is the highest figure in company history since its foundation in 1923. Orders received increased 12.5 percent to 3.8 billion euros from 3.4 billion euros in 2016/17. Operating income before taxes rose by 52.3 percent to 514 million euros from 337 euros in fiscal year 2016/17. The net operating margin amounted to 14.4 percent compared to 10.8 percent one year earlier.

Driven by an ongoing and strong global economy, Trumpf was able to significantly exceed its projections in some areas. The company’s largest business division, Machine Tools, increased its sales by 11.3 percent. The Laser Technology division achieved sales growth of 21.5 percent. EUV lithography for the exposure of microchips performed particularly well, increasing by 57.3 percent over the previous year to 250 million euros. Trumpf’s plans for the current 2018/19 fiscal year envisages further noticeable growth in EUV lithography. Even today, sales in this strategically important business segment exceed those of most of the company’s foreign sales markets.

Once again, Germany was the largest single market for Trumpf, with sales up by 15.6 percent to 719 million euros, followed by China with sales that reached 457 million euros. This was 13 percent higher compared to the previous year. Sales from the United States was also up by 5.4 percent compared to the previous year and reached 444 million euros, making the country the third highest earning market for Trumpf. Year-on-year sales in Italy grew by 31.8 percent to 173 million euros, making the country the fourth strongest single market for the first time. In addition to these markets, Trumpf also intends to intensify its business activities in countries such as Mexico and Canada as well as in the Asian countries such as Thailand, Malaysia, Indonesia, Singapore, and Vietnam in an effort to achieve an average annual growth of 10 percent.

In the current fiscal year, despite the general slowdown of the global economy, Trumpf expects to generate business with a similar level of profitability.

The group wide workforce grew by 12.9 percent in the reporting period to 13,420 employees as of the June 30, 2018 balance sheet date and has since exceeded the 13,500 mark. In Germany, there were 6,778 employees, around 3,900 of whom were employed at the company headquarters in Ditzingen. This equates to an increase of 12.5 percent. Outside of Germany, the number of employees rose by 13.3 percent to 6,642. More than half of Trumpf’s employees were stationed at the company’s German sites in Baden-Württemberg, Saxony, North Rhine-Westphalia, and Berlin. During the year under review, 450 young people completed a training course at Trumpf or a co-op work-study program. The training quota in the group stood at 3.5 percent.

In the past fiscal year, Trumpf invested in emerging technologies such as EUV lithography or metal 3D printing (additive manufacturing), as well as driving forward the AXOOM digital business platform. Expenditure on research and development rose by 5.9 percent to 337 million euros. The company’s R&D ratio in relation to sales amounted to 9.5 percent. The number of employees worldwide working on new products for TRUMPF increased by 13.2 percent to 2,087.

The company’s capital expenditure totaled 216 million euros in the 2017/18 reporting period. Real estate and construction projects accounted for 43 percent of the total sum invested, technical plant and machinery for 18 percent, and office and business equipment for 33 percent. More than half of this expenditure concerned construction projects in Germany, with around two thirds of this sum going toward the new headquarters building in Ditzingen, and the remaining one third to the expansion of the German manufacturing sites in Teningen and Schramberg.

Investments in other European countries accounted for 13 percent of the Group’s total capital expenditure, while 15 percent concerned the Americas. The smart factory demonstration center in Chicago is an outstanding example, representing an investment of 26 million euros. Another major investment project was the creation of the Trumpf Group’s largest-ever production site, operated by the Chinese joint venture JFY. The total cost of this investment was 14 million euros.

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