Electronics is the only Business Group at FORVIA HELLA that is growing this year. In this interview, Jörg Weisgerber and Johannes Müller discuss what the Electronics business is currently benefiting from and what need to be done moving forward.

_{Thursday 2025-09-04}

Jörg Weisgerber is, as a Member of the Managing Board, responsible for FORVIA HELLA's global Electronics business, Johannes Müller heads the Corporate Strategy department and is also responsible for the Electronics strategy. In this interview, they discuss how they see the Business Group currently performing, what they expect for the coming years, and what needs to be done moving forward. The interview is part of a series on the results of the annual strategic planning process. The results for Lighting and Lifecycle Solutions have already been published. A presentation with detailed results can be found here.

Mr. Weisgerber, Mr. Müller, let's talk about the current situation and the strategic orientation of the Electronics Business Group. If you, Mr. Weisgerber, would need to give this interview a headline, what could that be?

Jörg Weisgerber: If it was to be short and sweet, then something like: We are on track. Which ultimately also means: staying on track and not losing focus.

Sales are increasing, earnings are largely robust, and order intake is well above target. All in all, they should be quite satisfied.

Weisgerber: Yes and no. Much of what we have started in recent months and years is now paying off. We see that now. However, we should be wary of becoming overly confident too soon. The market is still very volatile and characterized by uncertainty. In the phase following the onset of the coronavirus pandemic, particularly in the period from 2022 onwards, we were already on course for growth – and then the market took another turn and we had to react.

Johannes Müller: The fact is that, despite current growth, our electronics sales in 2025 will not reach the level we – based on booked business – had anticipated a few years ago. There remains a gap of a good one billion euros because the market and, above all, the sales figures of our European customers have developed differently than originally assumed. This is the point that Jörg has just raised. And this is also why the many measures that we have implemented, above all within the framework of the Competitiveness Program for Europe, were necessary.

What do you expect for the second half of this decade, i.e. the planning period of this year's strategy process?

Müller: 2026 is likely to be another year of transition. Especially from 2027 onwards – after everything that is currently booked in our systems – we will see more growth again. And we are expecting to grow faster than vehicle production. This is always an important indicator for us to assess where we actually stand with our business development.

What is the reason for the expected growth?

Müller: The proportion of electronic products installed in a vehicle is increasing. Today, electronics account for around 25 to 35 percent of the value of a vehicle, and up to 50 percent for electric vehicles. This will continue to rise successively in the future. We benefit from this. However, we must also note that many electronic products are becoming even more "commodities", i.e. standard products, so to speak. They will be cheaper. In the case of radar sensors, for example, we see a possible halving of today's price. This also shows how much we have to keep an eye on our cost structures in order to remain competitive and attractive in the market.

Weisgerber: The cost basis is a very important point. In the past, we had an R&D ratio of up to 18 percent. We had to come down from that, otherwise we would have been massively endangered in the future. In addition, two other important factors are very important: our portfolio and our customer mix. Neither was always up-to-date in the past, and we have already caught up a lot. This, in turn, was only possible because we worked significantly on our cost structures, with fewer external service providers, simpler processes, and more efficient and faster development.

First, let's talk about the portfolio. What do you think will be the next big thing?

Weisgerber: At the moment, for example, we have very good momentum in the field of body electronics. With our intelligent Power Distribution Module and our Zone Controllers , we have developed two new technologies that are taking us significantly forward. The way in which electronics and electrics in the vehicle will be designed will change fundamentally. Today, a good 100 control units are installed in a car, but in the future there will be only a few, but much more complex control modules. The Product Center Body recognized early on that this would require completely new products, which are also absolutely necessary for autonomous driving, and developed suitable solutions. (Note: Advanced Control Modules, as the products were initially called, have recently been promoted under the new term Zone Controller.)

Müller: Overall, we have a broad portfolio, with sensors and actuators, with battery and power electronics, with body electronics, and also with software. This has two advantages: On the one hand, it reduces risks. On the other hand, it makes it possible to address promising topics, because we often have technological links to existing products, even with new products. Through this approach, we have been able to tap into promising profitable market segments time and again in the past. Especially with iPDM and zone controllers, we have recently succeeded very well. The situation could be similar with so-called X-in solutions for electromobility – i.e. a system solution that integrates various components such as voltage converters in one concept. The difficulty is above all to assert oneself against other top dogs in the market.

Weisgerber: It is crucial to listen very carefully to the market and to understand the requirements of our customers exactly. The order intake shows that we currently have a very good sense for this. But the truth is also that there are also examples in which we have not succeeded so well.

What would they be?

Weisgerber: A current and concrete example would be the radar sector. We have a very successful roll-out business, which is also a major contributor to this year's sales. But we have not succeeded in bringing our latest product generation – the Gen7 – to customers on a broad scale.

What was the reason for that?

Weisgerber: We were successful in India, which is strategically important for the market, but only brings in a relatively small turnover volume. The bottom line is that several factors were decisive here. The performance of our radar sensor is very good, as our customers have confirmed to us. But we were too expensive for what the market was willing to pay. We need to continue to work on our cost base, work more flexibly with the right partners on the chip supplier and system integrator side, and also get closer to our customers. This applies specifically to radar, but in principle it can be transferred to the other product groups as well.

In addition to the product range, resilience also includes positioning oneself more broadly regionally, being less dependent on individual markets. However, large projects for iPDM and Zone Controller have been won for the European market. How does this fit in with the strategy of growing, especially in markets outside Europe?

Weisgerber: We want to be about equally strong in all markets in the future. Last year we were very successful in the Americas, and in China we are also doing more and more business with local manufacturers. This year, due to large orders for Zone Controllers and iPDM, we are now a bit more European-oriented. But these short-term fluctuations are normal. If we look at the long-term order book as a whole, we are absolutely on the right track. In 2030, based on our current strategic planning, we will generate around 55 percent of our sales outside Europe. In 2024, this figure was still 45 percent.Also due to trade restrictions, the regions seem to be decoupling themselves a little from each other. What opportunities do you see in the various markets?

Müller: Jörg has just said it – we want to gradually reach at least a comparable level in terms of sales in all markets. For the Americas, this means reliably industrializing the major projects we won last year. This also applies to Europe, especially for iPDM and Zone Controllers. And we have to keep an eye on the volume and premium segments, an approach quite comparable to the Lighting business. In Asia, local-for-local is paramount. In China, we have made promising progress in this area, also with our independent company HELLA Nanjing Electronics. In India, too, we are in a good position to benefit from the expected growth of the market. Japan is certainly a bit more difficult because it is more self-contained in terms of business relationships. Here, some manufacturers are more open to European suppliers, others are not. We have been an established supplier in the components sector for many years. In the new segments, I see great opportunities, especially for body electronics.

New technologies should be developed cost-effectively and in a shorter time, but at the same time be reliable and of high quality. How can this be reconciled?

Müller: Above all through processes. We have extremely strong development teams worldwide, in all markets. That's a massive pound that also sets us apart from many competitors. For us, the most important thing is to simplify and shorten our processes as much as possible, to dispense with unnecessary reports, to slim down checklists. The focus must be primarily on those aspects that are necessary for the clean development and industrialization of a product. We have to consistently leave out everything else. Obviously, this is easier said than done. But at the moment we are doing that quite well.

All in all, would you say that Electronics has the worst behind it and now sees light at the end of the tunnel again?

Weisgerber: Yes – associated however with a "but". I know a lot of people think that this "yes, but..." is an integral part of our corporate culture at FORVIA HELLA. What I mean by that is that we are currently seeing that we have done a lot of right things recently. But we've been in a situation like this before in the past – and in the end it turned out differently. We therefore have to keep asking ourselves critically whether the things we do are the right ones. And if not, we must adapt and take countermeasures wherever necessary. And: We have won large orders for complex technologies. Customers place their trust in us, and we have to pay it back. We have to execute. That would perhaps be even better a headline for this interview.