ZF signals more divestments as it targets lower debt

ZF Friedrichshafen its yearly study revealed it whitethorn merchantability further businesses arsenic it works to further trim nett debt.

In 2025, the German auto-parts shaper reduced fiscal liabilities by astir €250m, lowering nett indebtedness to €10.2bn ($11.7bn).

“This deleveraging is an important motion of stableness and assurance – for employees, customers, and superior markets,” said CFO Michael Frick. “We volition proceed this way of integrated indebtedness reduction, complemented by proceeds from selective divestments.”

ZF has already been pursuing disposals. In December, it agreed to merchantability its driver-assistance concern ADAS to Samsung Electronics’ Harman for €1.5bn.

The radical besides spun disconnected its upwind powerfulness part into a standalone unit, saying the determination would unfastened up “strategic options” for that business.

On trading, ZF reported radical income of €38.8bn for fiscal 2025, down 6% from €41.4bn successful 2024. Excluding M&A and currency effects, income roseate by astir 0.6% organically.

“The wide representation hasn’t changed: We spot nary wide based betterment successful demand. We indispensable execute successful an situation without meaningful marketplace growth. That requires higher profitability. This remains our focus, on with currency travel procreation to trim our debt,” Frick said.

Adjusted EBIT accrued to €1.7bn from €1.5bn a twelvemonth earlier. The adjusted EBIT borderline improved to 4.5% from 3.5%.

ZF said it is preparing for different twelvemonth of subdued demand, forecasting 2026 gross to beryllium broadly unchangeable astatine conscionable implicit €38bn.

To trim unit from indebtedness and refinancing costs, the institution is continuing a restructuring program that could see up to 14,000 occupation cuts successful Germany by the extremity of 2028.

ZF said it halted respective e-mobility projects aboriginal and booked €1.6bn successful one-time charges successful fiscal 2025, citing a slower-than-expected displacement to electrical vehicles.

It added that it is present counting connected stronger request for combustion-engine and hybrid powertrains, portion besides watching for a imaginable easing of European Union restrictions connected interior combustion engines.

During the results presentation, CEO Mathias Miedreich addressed regulatory issues.

“Location factors proceed to measurement connected us. We expect Berlin to contiguous a caller betterment agenda. And we expect Brussels to beryllium honorable astir fleet wide CO₂ legislation.

"The European Commission has hinted astatine much flexibility but continues an concern argumentation collision course.

"We urgently request adjustments, particularly regarding plug successful hybrids, which are a cardinal modulation technology. “They easiness scope anxiety, enactment the ramp up of electrical mobility, and assistance safeguard jobs,” said Miedreich.