The automotive supplier ZF Friedrichshafen has reported a staggering loss of just over one billion euros for the year 2024, as the company continues to face immense challenges stemming from a struggling market and significant investments in electromobility. According to reports published on March 20, 2025, ZF witnessed a drastic decline in revenues, marking a decrease of approximately 11 percent, translating to a loss of 5.2 billion euros compared to 2023.
Once a powerhouse in the automotive supply sector, ZF's financial struggles have been compounded by high provisions for restructuring costs amounting to around 600 million euros. In contrast, the company recorded a modest profit of 126 million euros in 2023, underscoring its rapid decline. Holger Klein, the ZF CEO, stated, “The year 2024 has made clear the pressure under which our industry as well as our company stands,” highlighting the dire circumstances facing many players in the automotive supply chain.
As ZF attempts to navigate through these choppy waters, the overarching goal is to reduce debt, which currently exceeds ten billion euros, and transform the company into a more agile and profitable technological leader. “We are facing pressure from various fronts, including the demand for EVs which has not materialized as we anticipated,” Klein added.
The financial outlook for ZF appears grim, as for the fiscal year 2025, the company anticipates revenues of over 40 billion euros, assuming stable exchange rates. This forecast is troubling, considering the significant layoffs underway. The company announced last summer that it would reduce its workforce in Germany by as many as 14,000 positions by the end of 2028. This move comes as ZF plans to cut approximately 4,000 jobs already and anticipates further reductions in the future.
As of December 31, 2024, ZF employed 161,631 individuals worldwide, representing a decline of about 4 percent from the previous year. In Germany alone, the workforce has diminished to just over 52,000 employees, also down by approximately 4 percent.
Despite having faced considerable challenges, ZF plans to distribute a dividend of slightly more than 40 million euros to the city of Friedrichshafen, which owns 93.8 percent of the firm through the Zeppelin Foundation, led by the mayor of the city. However, this decision has drawn scrutiny amidst the backdrop of almost continuous losses and significant restructuring efforts.
The automotive industry as a whole is undergoing a transformation, challenged not only by domestic economic concerns but also rising competition from global markets, particularly from China and electric vehicle manufacturers like Tesla. Klein’s comments reflect the widespread concerns as European manufacturers face market share being taken by imported products, highlighting that “the situation remains difficult for the industry.”
ZF's future also appears uncertain, especially for its Saarbrücken plant, which currently employs around 8,500 workers and saw 1,300 jobs cut in 2024 alone. Further reductions are likely as the firm overhauls itself to fit the rapidly changing automotive landscape. The Saarbrücken location has been pivotal for ZF, producing approximately 2.2 million automatic transmissions in 2024, but its long-term viability remains in question.
As ZF attempts to cope with its challenges, it is exploring potential partnerships to enhance its financial flexibility, notably in its drive division, which is integral to the company's structure with over 30,000 employees. Klein confirmed that, “Currently, we are preparing this sector for potential partnerships,” although he emphasized that outright sales are not being considered at this juncture.
Looking forward, ZF hopes to emerge from this period of restructuring stronger, with a focus on the technological advancements essential for the future of mobility. However, with significant commercial and operational hurdles still ahead, the journey toward stabilization and growth will undoubtedly be a complex one.
