French automotive components manufacturer Valeo has placed a clear emphasis on CO2 emission reduction as it outlines its goals for the coming years.
As part of an investor day in Paris, the company presented a strategic plan and medium term financial objectives that will include higher organic growth and becoming a major player in the sector.
It will devote two thirds of its advanced research development to technology solutions to downsize internal combustion engines and for hybrid and electric vehicles. Part of its focus will be reducing component weight and energy consumption as it hopes to double it sales for technologies linked to CO2 reduction to €1billion by 2013 and then to more than €5billion by 2020.
According to Jacques Aschenbroich, the group’s chief executive officer, CO2 emissions and high growth in emerging markets will drive the automotive market over the next few years. With a focus on those two areas, Valeo should be able to return organic growth and play an active role in the consolidation of the sector.
He believes that organic growth should be higher than that of global automotive output and that sales of €10billion can be reached by 2013 and €15billion by 2020. The company will also investigate external growth opportunities and plans to devote 60 per cent of its investments to emerging countries to reinforce historical positions with particular emphasis placed on China, Brazil, Thailand, India and Turkey, with plans also outlined to boost the company’s presence in Russia.
In addition, Valeo has presented a dossier to the European Works Council to form a new organisation based around four business groups with the objective that by 2013 it will have one of the best performances in its sector in terms of the return of capital. It will also aim to improve its operating margin by reducing administrative expenses, limiting investment to 80 per cent of depreciation and returning to group average profitability for the Visibility Systems Business Group.
