Executive View -- Still Committed to Detroit

Executive View -- Still Committed to Detroit

Robert Bosch's Peter Marks sees a future for green auto technologies in the U.S., but says hybrids and electric cars are a ways off.

The collapse of the U.S. auto industry has so battered its supply base that in April Robert Bosch GmbH, the world's largest auto parts supplier, forecasted a loss for 2009. Sharing the burden is the company's Farmington Hills, Mich.-based North American subsidiary Robert Bosch LLC, which reported a 10% sales decline in 2008 and predicted a "difficult year" for 2009. Leading the $9 billion U.S. business unit through these challenging times is President and CEO Peter Marks. German-born Marks says despite the struggles facing the U.S. auto industry, the industry's focus on becoming green represents significant opportunities for Bosch. In his words:

Peter Marks
President and CEO
Robert Bosch LLC

Peter Marks has been president, chairman and CEO of Robert Bosch LLC since Jan. 1, 2006. He is a member of the board of management of parent company Robert Bosch GmbH, whose headquarters are in Stuttgart, Germany. Marks began his career as a machinery fitter in 1968 before obtaining an engineering degree in his native Germany. He joined the Bosch Group in 1977 and began working for the company's U.S. operations in 1982.

Green Opportunities: We are very bullish on clean diesel technology. In Europe, about 50% of the cars being sold are diesel, for a good reason. You get a 30% fuel mileage improvement, 25% CO 2 emissions improvement, and that is the telling story. You have good power, and people really like this technology. We also are working on some incremental improvements to fuel economy, such as the start-stop system. In Europe, it's taking off quite well, and we think the U.S. market also is poised now to embrace the start-stop technology where you have a 5% to 7% fuel economy improvement, depending on your driving cycle. That's basically looking at what we can do tomorrow. But we're also certainly looking at the day after tomorrow -- anything that has to do with hybridization until the electric car comes about. So we have 400 engineers working on hybrid technology and electric vehicle technology. We also have started a joint venture with Samsung SDI for developing and manufacturing a lithium-ion battery for vehicles.

Health Care: When we developed our strategic direction, we looked at demographics as one of the megatrends. And from this megatrend we clearly recognize that in a lot of countries there will be an aging population. Associated with this will be an increasing need for health care. We think we can make a contribution to reduce health care costs. The company that we acquired -- Health Hero Network -- is involved in health monitoring. We do the health monitoring at the patient's home, preventing the patient from returning unnecessarily to the hospital, which saves a lot in health care costs. We are very good in software -- intelligent software -- and we are very good in sensor technology coming from the automotive side. We envision micro-machine sensors, which we will develop for the vital measurement of a person's health.

Electric Cars: It's not the answer tomorrow. It is not the answer for the model year 2016 because one of the deciding technologies for the electric car is the battery. The battery still in 2015 will cost between $12,000 and $17,000 alone. And this is already anticipating that we make significant improvement until then. Even more advancement needs to be made so that the whole powertrain based on electricity is a viable business case for the end consumer. Not to mention it wouldn't help if the electricity is coming from coal-fired power plants. Then our CO2 emissions are equally as bad as if we used fossil fuel. So, therefore, I'm saying we need to have technologies exploited in between, but certainly put all our efforts into the electrification, in addition.

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