German automotive supplier Poppe-Veritas has announced investments amounting to in total EUR 42m for 2017.
As part of its new "Strategy 21+” programme, the company is investing EUR 6m in the future viability of the headquarters in Gelnhausen, and in its further internationalization. Not only will the site be modernised, the family-owned manufacturer of vehicle sealing, fluid and thermal management systems is investing a similar amount this year in a new IT system, which will be launched in Gelnhausen in 2018.
Poppe-Veritas went through a prolonged restructuring process between 2014-2017, as a result of which, among other things, Gelnhausen became a production location. The Group has now entered the consolidation phase; as board spokesperson, Lucie Toscani, said: “On the basis of our restructuring program, we have succeeded in making the location competitive again. That's why we can look optimistically into the future and even create new, highly qualified jobs in Gelnhausen in 2017.”
The further internationalization of the Poppe-Veritas Group's business is an important aspect of the 21+ strategy. In that context, the company is opening a plant in Kunshan, Jiangsu / China for blow moulding charge-air ducts, thereby expanding capacity at its site there. The first line of products is expected to be produced in Kunshan in September or October 2017. Investments totalling some EUR 11m are planned for China in 2017.
In total, the investment volume in 2017 amounts to around EUR 11 million in China. The
Poppe-Veritas Group is aiming for local Chinese production to contribute around 20% of sales in coming years. "“If we wish to play a part in our customers’ global platform concepts, we are going to have to expand our presence in China still further. Apart from that, however, we also see a big opportunity to gain new customers for Poppe-Veritas on the Chinese market," said Toscani. Poppe-Veritas has already managed to generate new orders worth EUR 60m in the country in 2017.
The company also aims to take advantage of developments in the area of mobility. It sees potential in products for the optimization of the combustion engine as well as in thermal management solutions for electric vehicles. " According to industry experts, mobility will continue to be dominated by the internal combustion engine until 2025. We will benefit from the trends such as downsizing and lightweight construction, as well as the growing importance of hybrid vehicles,” said Toscani. "We already have a presence in hybrid vehicles. But we are also well positioned for pure electric vehicles.”
She added: "For electric mobility, extensive cooling systems are required, for example for the battery, the drive and the power electronics. We have developed new material solutions that are precisely tailored for these applications.”
Following the years of restructuring, Group sales stood at EUR 654 million for 2016, slightly below last year's figure of EUR 684 million. However, incoming orders show that the new strategy has laid the foundation for future revenue growth: 2016, order intake rose by 9.6% to EUR 562 million, versus EUR 513 million in 2015. Especially heartening: at the end of the first six months of this year, the order intake has already risen to slightly above the total value for 2016. The Poppe-Veritas Group expects sales this year to match the level of the previous year.