ZF acquires ADAS provider Wabco
In a deal worth more than €6 billion, Germany-based transmissions supplier ZF Friedrichshafen has acquired Wabco, a provider of advanced driver assistance systems (ADAS).
Headquartered in Brussels but with executive offices in Auburn Hills, Michigan, Wabco manufactures ADAS for trucks and trailers. It employs about 16,000 people in 40 countries. Last month, the company posted net income of €372 million on revenue of €3.4 billion. ZF and Wabco already worked together in the past, jointly building an evasive manoeuvre assist system.
For ZF, the acquisition (which is expected to close in 2020) is the fulfilment of a long-held ambition to increase its expertise in ADAS. The company thinks vehicle connectivity and semi-autonomous driving functions will become major growth areas in the automotive industry, and particularly in the trucking and delivery sector.
In a statement, ZF said it expected the combination of both business “to further accelerate the development of new technologies to enable autonomous commercial vehicle functions, making ZF less dependent on the economic cycle of the passenger car industry.” Specifically, the deal will enable ZF to expand its commercial-vehicle division's expertise in vehicle dynamics control.
It's not ZF's first foray into the ADAS and autonomous-driving market. In 2014, it acquired self-driving car tech company TRW Automotive for more than €12 billion. ZF previously said it plans to invest €12 billion in e-mobility and autonomous driving. According to Goldman Sachs, the ADAS and autonomous-driving market will grow from about €2.5 billion in 2015 to €85 billion in 2025 and €258 billion in 2035.