THE MAGAZINE OF THE KNORR˜BREMSE GROUP...passenger and freight transportation are pushing urban infrastructure to the limits, polluting the environment and ... environmentally friendly

T H E M A G A Z I N E O F T H E K N O R R - B R E M S E G R O U P

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G R O W T H D R I V E R S How to apply the right technologies to advance global megatrends – and drive your own growth. Page 04

O F D R I V I N G A N D B E I N G D R I V E N How to automate commercial vehicles – and in the process � nd solutions for tomorrow’s world. Page 24

H E A R T B E AT How to determine the pulse of a megacity – and transport more and more people from A to B faster and more safely than ever. Page 30

D I V I S I O N SKnorr-Bremse has a global market share of approximately 50 % in the rail vehicle brakes segment and a 32 % share in pneumatic braking systems for commercial vehicles. The Company also holds a leading market position in respect of other subsystems.

R E V E N U E G R O W T HIn � scal 2018, Knorr-Bremse revenues increased by 10.5 % (adjusted for foreign exchange e� ects). Reported revenues showed a 7.5 % year-on-year increase to euro 6,616 million.

in euro millions

in euro millions

+7.5%

5.5%

Knorr-Bremse is the global market leader for braking systems and a leading supplier of subsystems for rail and commercial vehicles.

R E S E A R C H A N D D E V E L O P M E N TKnorr-Bremse has been granted or applied for more than 11,000 patents worldwide and invests an average of 5 – 6 % of revenues in research and development.

At a glance

28,500E M P L O Y E E S

100AT O V E R O N E H U N D R E D L O C AT I O N S

30I N M O R E T H A N T H I R T Y C O U N T R I E S

6,616

6,154

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2 0 1 8

2 0 1 7

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Driving growth, as opposed to just benefitting from it, is the motto that guides our actions at Knorr-Bremse. On the pages of this magazine you will discover how we transform the challenges facing society – urbanization, eco-efficiency, digitization and automated driving – into our growth drivers [p. 04]. Read about what makes our technologies the best of both worlds [p .18] as they generate synergies between our Rail Vehicle Systems and Commercial Vehicle Systems divisions. In our story of driving and being driven [p. 24], you will find out why the expertise in braking and steering systems that we have acquired in over a century provides the ideal foun-dation for the automated future of trucking – and how our rail vehicle technologies determine the heartbeat [p. 30] of megacities around the world.

We also want to give something of our success to the local com-munities at our various locations. That’s why our employees assign such importance to voluntary engagements in the spheres of environmental protection, healthcare, social cohesion and education − and Knorr-Bremse encourages them to do so. Because education is the future − everywhere [p. 36], and it’s the most important tool in acquiring skills for life [p. 40]. So we have every reason to support the independent, not-for-profit organization Knorr-Bremse Global Care that helps people across the globe to help themselves. Which, after all, is another way to drive growth.

1D R I V I N G G R O W T H

P A G E 1 8 There are huge differences between the rail vehicle and commercial vehicle markets. But collaboration across divisions generates substantial synergy effects that benefit both product development and quality.

P A G E 0 4 Urbanization, eco-efficiency, digitization and automated driving – when you develop the tech-nologies behind the global megatrends, those trends also drive your growth.

Growth drivers

The best of both worlds

P A G E 1 2 The IPO marks the dawn of a new era at Knorr-Bremse. The members of the Executive Board explain how well prepared the Company is to face the future.

From strength to strength

Contents

K N O R R - B R E M S E A G M A G A Z I N E 2 0 1 82

P A G E 3 0 Traffic determines the pulse of the world’s expanding megacities – and traffic threatens to choke them. Solutions are urgently needed and in many cases rail transportation holds the key.

Heartbeat

P A G E 2 4 Highly automated driving is a key building block in the mobility of the future. Digitally connected platoons of trucks will be one of the next steps on the road to fully automated commercial vehicles.

Of driving and being driven

P A G E 4 0 Helping people to help themselves is the most sustainable form of aid. With this in mind, Knorr-Bremse supports the not-for-profit association Knorr-Bremse Global Care. In São Paulo, the association is helping the residents of a favela to build themselves a secure future.

P A G E 3 6 Maintaining a global presence means being a local citizen in many different places around the world – and sharing responsibility for the future of these locations. The best way to make this happen is through personal engagement by the people on site.

Education is the future − everywhere

Sources: Cited studies and publications are documented in the imprint on p. 44.

Providing prospects, Creating the future

3C O N T E N T S

U R B A N I Z A T I O N

In 2050, 9.8 billion people will be living on this planet – 70 % of them in cities.

Source: UN DESA, 2018


The global population is growing inexo-rably. By the next generation, almost three quarters of the world’s inhabitants will already live in cities. Consequently, societies around the globe are facing ma-jor challenges. In Asia in particular, the megatrend urbanization has only just be-gun to pick up speed. Here and across the planet, ever-increasing volumes of passenger and freight transportation are pushing urban infrastructure to the limits, polluting the environment and impacting on people’s safety as they travel.

Tomorrow’s world will need modes of road and rail transportation that are totally safe, rapid, clean and reliable. This is precisely what development efforts at Knorr-Bremse are focused on, and these prospects hold enormous growth po-tential for the Company. With 114 years of experience and a unique pool of ex-pertise in respect of braking systems for rail and commercial vehicles, together with a leading position in the develop-ment of connected system solutions and great competence in the field of auto-mated driving, we offer solutions to all of these challenges. How? By enabling highly efficient utilization of rail net-works; by delivering a significant improve-ment in safety on increasingly con-gested roads; and by helping to reduce the carbon footprint of urban freight and passenger transportation.

+2 bnP E O P L E B Y 2 0 5 0 .

Source: UN DESA, 2017

Global demand for energy is rising con-stantly. At the same time, public aware-ness of the need for energy-efficient, sustainable development is growing and legislators worldwide are introducing more and more rigorous environmental regulations. In the transportation sector in particular, efficient solutions are in greater demand than ever before. In response, Knorr-Bremse systematically combines ecological and economic thinking in both its products and its production processes.

As a result, eco-efficiency is built into the functionalities of our products from the outset – in the electrically controlled exhaust gas recirculation valves from GT Emissions Systems, for example, or the In-Motion-Charging products supplied by Knorr-Bremse Group company Kiepe Electric. These enable electric buses to recharge their batteries while in motion, recuperating brake energy in the pro-cess. Even the materials we use offer great potential savings − through the use of environmentally friendly friction materi-als in brake pads, for example. And by remanufacturing used and overhauled parts, in 2018 alone we were able to save some 1,400 tons of CO2, 317 tons of raw materials and 5,460 MWh of energy, compared to the production of new products. On the production side, at the Knorr-Bremse Commercial Vehicle Systems plant in Pune, India, for example, since 2017 a solar power plant has been meeting one-third of the plant’s elec-tricity needs. This cuts costs and has led to a sustainable reduction in emissions.

Designing sustainable products and pro-duction processes is a genuine growth driver for Knorr-Bremse.

+30 %W O R L D W I D E E N E R G Y D E M A N D B Y 2 0 4 0

Source: International Energy Agency, 2017

By 2040, the global economy will grow by an average of 3.4 % annually, the world population to more than 9 billion people.

E C O - E F F I C I E N C YSource: International Energy Agency, 2017

7G R O W T H D R I V E R S

By 2030, in Germany alone 30 billion euros will be flowed into the targeted pan-European digitization of rail transportation.

D I G I T I Z A T I O NSource: McKinsey & Company, Signals set for growth 2018


Digitization is not what lies ahead, it has long been with us. In every area of our lives it supports efficiency and optimized procedures, not least in the rail sector. Here, and in transportation in general, new and data-driven business models are being created. Increasingly the sources of the data are the vehicles themselves, because they too and all their subsystems are becoming more and more digitized. Driving this process are developments such as the trend toward highly auto-mated driving or the transformation of logistics into an all-embracing, net-worked ecosystem.

This is the world for which Knorr-Bremse systematically designs its products. Digital Global Scalable Brake Control (GSBC) for instance, coordinates the various in-telligent vehicle systems to perfection, creating the ideal platform for future driver assistance functionalities. One such system already on the market is EP 2002 3.0. Our services too are becoming smarter, with remote diagnostics, predic-tive maintenance and smart connec-tivity solutions such as the iCOM plat-form in the rail vehicle sector or the ProFleet Connect telematics solution for commercial vehicles. This makes us the ideal partner for all companies in the transportation industry who have under-stood the digital signs of the times.

To keep things that way, every six months we scout start-ups that deal with fields of technology that are important for us, such as connectivity, industry 4.0 and artificial intelligence. Together with these start-ups, we take the technologies of the future forward, actively fostering the megatrend that is driving our growth.

A R E I N V E S T E D A N N U A LY O N T H E G L O B A L M A R K E T F O R R A I L I N F R A S T R U C T U R E T E C H N O L O G Y I N T E C H N O L O G I E S S U C H A S T R A I N T E L E M AT I C S .

Source: McKinsey & Company, 2018

18 B I L L I O N E U R O S

Faced with market concentration, increas-ingly fierce competition and falling prices, the transportation industry is under pres-sure. The solution goes by the name of automated driving. What are the benefits? Far greater vehicle utilization, fewer acci-dents, lower fuel and personnel costs in the truck sector, and lower life cycle costs, total cost of ownership and greater train frequency on the rail vehicle side. Not for nothing is automated driving – a step along the way to autonomous trucks – one of the industry’s megatrends.

Knorr-Bremse is the development leader in terms of the key technology here. Our understanding of the dynamic handling of commercial vehicles is unique – in all of the necessary dimensions. As the world’s leading manufacturer of braking systems, we have an unparalleled command of longi-tudinal dynamics. And in terms of lateral dynamics, Knorr-Bremse SteeringSystems can draw upon outstanding expertise. This enables us to offer intelligently networked commercial vehicle braking and steering systems from a single source, and to devel-op innovative solutions that cut costs and deliver added value. By way of example, our smart braking systems guide auto-mated trucks that suffer a steering system failure to the side of the road and bring them safely to a standstill. This dispenses with the need to install a fallback steering system. Based on our in-depth knowledge, for years now we have been setting bench-marks on the road to highly automated freight transportation. In 2016, for exam-ple, we demonstrated a truck capable of Autonomous Yard Maneuvering. The next step will be platooning, with trucks of various makes. This not only ensures that our customers remain competitive but also secures Knorr-Bremse’s own position in what is a growth market of the future.

47 %R E D U C T I O N I N L O G I S T I C S C O S T S F O R S TA N D A R D I Z E D T R A N S P O R TAT I O N B Y 2 0 3 0 − T H R O U G H D I G I T I Z E D A N D A U T O M AT E D L O G I S T I C S P R O C E S S E S A N D V E H I C L E S .

Source: PwC Strategy&, 2018

Autonomous driving will increase the utilization factor of trucks by almost 50 % by 2030.

A U T O M A T E D D R I V I N GSource: PwC, Strategy&, 2018

1 1G R O W T H D R I V E R S

K N O R R - B R E M S E A G M A G A Z I N E 2 0 1 81 2

From strength to strengthThe recent successful stock exchange listing marked the dawn of a new era for Knorr-Bremse. In the following interview the three executive board members Ralph Heuwing (Finance), Dr. Peter Laier (Commercial Vehicle Systems) and Dr. Jürgen Wilder (Rail Vehicle Systems) talk about the technologies with which Knorr-Bremse is driving forward developments by road and rail.

global market leader in braking systems for rail and commercial vehicles, and a leading supplier of further safety-critical subsystems in both sectors. When we look to the future, we can see that our industry will be subject to significant change. Societal megatrends such as urbanization, eco-efficiency, digitization and automated driving are shaping new technologies. We are actively driv-ing forward these trends and through our research and development activities we are helping to refine them. This is all part of our self-image as a company. New investors back potential, and Knorr-Bremse is outstandingly well placed to benefit from the global megatrends.

What makes you so sure that these megatrends will translate into revenue growth for Knorr-Bremse?Dr. Jürgen Wilder: Particularly in the densely populated Asian markets such as China and India we are witnessing a rising need for greater mobility, driving up economic growth and prosperity, as well as consumer demand. This in turn means a mid-term increase in volumes of passenger and freight traffic, which calls for rapid and efficient transportation within and between the major cities.

Knorr-Bremse’s 2018 stock exchange listing was the second-largest of the year in Germany. In March 2019 the company was promoted to the MDAX. Which of Knorr-Bremse’s strengths carried most weight with investors? Ralph Heuwing: The decisive aspects were our position in the marketplace and our long-term growth prospects. Today, with its in-depth know-how and exten-sive experience, Knorr-Bremse is the

1 3F R O M S T R E N G T H T O S T R E N G T H

Dr. Peter Laier: At the same time, vehi-cles are subject to ever-increasing re-quirements in the shape of stricter safety and environmental protection regula-tions. This leads to greater demand not only for our conventional braking sys-tems but also for new technologies: from digitization and elec tronic control for preventive maintenance, all the way to driver assistance systems or solutions for highly auto mated driving in trucks or rail vehicles.

How are you expanding your core fields of activity – fields in which you already cover a substantial portion of the market? Dr. Peter Laier: For one thing, we are adding to our portfolio in individual re-gions so as to achieve greater market penetration. But above all we are doing so wherever we can meaningfully com-plement our core products and strength-en our systems expertise as a result. Two years ago, for example, we entered the steering systems business in order to grow our competence in the field of highly automated driving. Today, with Knorr-Bremse SteeringSystems we com-mand the required know-how in respect of the two key actuators in a truck: the brakes and the steering – areas that are central to the development of highly automated driving. We expanded our competence here by acquiring the commercial vehicle steering activities of Hitachi Automotive Systems in Japan and Thailand. In addition, in a joint ven-ture with our Chinese partner Dongfeng we are also developing automatic trans-missions and driver assistance systems for trucks − products that will become in-creasingly widespread on the Chinese market. Dr. Jürgen Wilder: Above and beyond that, last year we acquired expertise and intellectual property rights from Feder-al-Mogul for the development and manu-facture of friction materials for the rail sector. This enabled us to further expand our systems expertise, reinforce our after-market business and acquire additional leverage to drive our growth and innova-tion. Electric drive systems are another example: Our Group company Kiepe Elec-

tric manufactures traction systems for trams, light rail vehicles and electric buses. Kiepe Electric also offers a state-of-the-art charging system for hybrid bus batteries. Known as IMC technology, this is used in trolleybuses for example.

Why does it make sense to operate in two different industries – commercial vehicles and rail vehicles? Ralph Heuwing: Our two fields of activi-ty complement each other to perfection because one operates in the public- and the other in the private-sector capital goods market. The market for rail vehicles is dominated by government spending. Growth tends to be linear and is subject to less volatility. Commercial vehicles, on the other hand, are private-sector capital goods – the market is highly dynamic and reacts to current economic develop-ments. One key success factor for Knorr-Bremse is the synergies between the two divisions at the product level. Knorr-Bremse is the only company that unites both fields – road and rail – under a single roof. We benefit to a high degree from joint research and development activities, for example in terms of the ma-terials used, system controls or braking distance management. In addition our solutions for rail and commercial vehicles are often based on the same core technologies.


Can you give us an example?Dr. Peter Laier: When disc brakes were introduced for commercial vehicles, our development engineers were able to draw upon experience with disc brakes in the rail vehicle sector. The success of the pneumatic disc brake in Europe enabled Knorr-Bremse to carve out a lead over strong competition. Today this competi-tive edge opens huge opportunities for us in the US market, where most trucks are still fitted with drum brakes. As a result of stricter regulations, in the US market too, trucks will have to be equipped with the more effective disc brakes in the future. Another example is the Truck Motion Controller which connects the various subsystems and driver assistance systems and is an important prerequisite for automated driving. This technology was developed for trucks, but it can also be used in driverless commuter trains and metro units.

How important is the replacement parts, repairs, maintenance and modernization business?Ralph Heuwing: Customer relationships are an important consideration here. As a rule, these relationships last the whole lifetime of a vehicle. But the aftermarket also has an important part to play for us in terms of revenues and earnings – in both divisions. In 2018, aftermarket busi-ness accounted for approximately one-third of our revenues.

New investors back potential; and Knorr-Bremse is outstandingly well placed to benefit from the global megatrends. R A L P H H E U W I N G C F O K N O R R - B R E M S E A G


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1) ADAS – Advanced driver assistance system; 2) HAD – Highly automated driving; 3) KPS – Knorr-Bremse production system; Source: Knorr-Bremse information

Leadership excellence

midterm improvement of EBITDA margin

+ 150 bp

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E X P A N D T E C H N O L O G YL E A D E R S H I P P O S I T I O N— Growth potential from new technologies— Introduction of ADAS1), HAD2) and

connected systems— Focus on digitization and connectivity— Significant profitability improvement in

non-braking technology products

C A P T U R E O P P O R T U N I T I E SF R O M M E G AT R E N D S— Win in RVS deregulated markets— Continued market outperformance in CVS

through ADAS, connectivity and e-mobility— Megatrends drive continued content

growth

D R I V E I N T E R N AT I O N A L I Z AT I O N S T R AT E G Y— Leverage profitable mass urban

transport opportunities, in particular in China and India

— Benefit from Belt and Road Initiative (BRI)— Increase exposure to high margin countries

G R O W P R O F I T A B L E A F T E R M A R K E T — Leverage large installed base— Apply new business models

(digital & data based)— Close to customer

C O N T I N U E D C O S T F O C U S — Set of initiatives to drive up the margins— Global supply chain & unified purchasing— Global process standards (KPS)3)

— Digitization of production, Industrie 4.0— Permanent cost discipline— PMI in newly acquired companies— Operating leverage

midterm organic growth p.a.

5.5%

+ 4.5 –


How does that high share come about?Dr. Jürgen Wilder: Rail vehicles are capi-tal goods for which there is no ready second-hand market. They are normally manufactured in small numbers and highly customized to the needs of the operator. As a result we usually have long term service agreements with our customers. The oper ators trust Knorr-Bremse to deliver high vehicle availability and technical upgrades. Dr. Peter Laier: In the commercial vehi-cle market, by contrast, along with the traditional consumables such as brake pads or filters, our customers also want value-based repair solutions, for example using remanufactured products from our EconX portfolio. Or they want telematics systems for their fleet manage-ment.

How important are the markets outside Europe for you? Ralph Heuwing: Very important. For us, globalization is a growth driver that also minimizes our risk exposure, because we benefit greatly from regional market developments in other parts of the world. Along with the Americas, which account for one-fourth of our unit sales, we are

seeing highly dynamic growth in the Asia-Pacific region as well. Mass transit within the megacities of Asia and the mainline links between them are attrac-tive projects in which we see major opportunities for growth.

Don’t you find it difficult to compete in regional markets with substantial differences in terms of road and rail vehicle homologation? Dr. Jürgen Wilder: The commercial and rail vehicle markets are indeed marked by strict and in some cases prolonged type- approval procedures. Anyone looking to supply these markets must deliver very good quality and be able to meet high safety requirements. Knorr-Bremse’s inter-nationalization began back in the 1980s, since when we have been building up business relations worldwide. As a result, today we are the only company that meets all local regulations and standards for the rail vehicle market and that has also enjoyed the trust of its customers for decades.

Are you concerned about the advance of protectionism around the world?Dr. Jürgen Wilder: We are strong advo-cates of free trade. But Knorr-Bremse maintains a presence at more than 100 locations in 30 countries, and we have local production operations in major na-tional markets such as the USA, China and India. Added to which, in many parts of the world we are perceived as a na-tional company with national manage-ment. We employ highly qualified staff who are recruited in the respective coun-tries. This strong local presence means that we can respond quickly to customer requests. Ralph Heuwing: And at the same time this enables us to offer outstanding prospects to people who want to play a part in shaping the future. Because as an international corporate group with some 28,500 employees, we develop projects worldwide in inter national teams that bring together colleagues in India, China, the Americas and Europe.

Thank you for talking with us.

D R . J Ü R G E N W I L D E R E X E C U T I V E B O A R D M E M B E R , R A I L V E H I C L E S Y S T E M S D I V I S I O N

We have local production operations in major national markets and we are perceived as a national company. That increases opportunities and min-imizes risks.


The best of both worlds


Urbanization, eco-efficiency, digitization and automated driving – these trends are among the key challenges for the future rail and commercial vehicle markets. They also represent a huge opportunity for Knorr-Bremse, a company that is equally at home in both worlds. While our disc brakes and screw compressors for commercial vehicles are prime examples of the long-established technology transfer between the divisions, we are also currently working on a variety of new projects.

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I N T E L L I G E N T E L E C T R O P N E U M AT I C T R A N S D U C E R S

It’s the mid-1980s and Knorr-Bremse is carrying out a major research project. A development team is testing brake discs, calipers and brake pads to their limits on the friction dynamometer. So far, so unremarkable. What is unusual, though, is that even all those years ago colleagues from Knorr-Bremse’s Rail Vehicle Systems and Commercial Vehicle Systems divisions were working side by side on the test rig, successfully finding a way of adjusting the procedure to test brakes for both rail and road vehicles. 30 years ago, the engineers were tasked with developing a Knorr-Bremse disc brake for commercial vehicles that would ideally become just as suc-cessful as its rail vehicle counterpart. And that is exactly what they achieved.

T W O D I V I S I O N S , O N E D E V E L O P M E N T C E N T E RThe sharing of existing test rigs between the two divisions was a key factor in the disc brake success story and a sign of things to come. Since 2016, some 650 highly specialized engineers and techni-cians from both sides of the business have been working together across disci-plines on the 100 state-of-the-art test systems in Knorr-Bremse’s new Munich Development Center. The Development Center is a landmark building that illus-trates the potential synergies between the Rail Vehicle Systems and Commercial Vehicle Systems divisions. Dr. Peter Laier, Division RVS, explains the stra tegy: “We

T E C H N O L O G Y T R A N S F E R B E T W E E N R A I L A N D R O A D

C O O P E R AT I O N T O D AY

— Identical core technologies— Cooperation on development

F U T U R E T E C H N O L O G I E S

— Joint research centers— Electric mobility

— Automated driving— Condition monitoring and predictive maintenance

— Electromechanical brakes

E C O N O M I E S O F S C A L E

— Technology leadership enabled by shared financial resources

— Overlap between future road and rail technologies

Technological benefits and economies of scale between rail and commercial vehicles

Synergies across the business


D R . P E T E R L A I E R , E X E C U T I V E B O A R D M E M B E R C O M M E R C I A L V E H I C L E S Y S T E M S D I V I S I O N , K N O R R - B R E M S E A G

We can and will benefit from the current megatrends of urbanization, eco-efficiency, digitization and automated driving by reflecting them in the continuous develop-ment of our products in both divisions.

can and will benefit from the current meg-atrends of urbanization, eco-efficiency, digitization and automated driving by reflecting them in the con tinuous devel-opment of our products in both divi-sions.” According to Ralph Heuwing, CFO of Knorr-Bremse AG, “The fact that our product portfolios in both divisions are based on similar technology enables the transfer of know-how and experience – which cuts costs.”

S T R O N G E R T O G E T H E R There is no denying that the markets and product requirements for rail vehi-cles and commercial vehicles are very different. For instance, while one of the heaviest commercial vehicle brakes tips the scales at around 30 kilos, the smallest rail vehicle system is many times heavier, since the energy that has to be braked is much greater on rail vehicles. This is why Knorr-Bremse’s two divisions operate sep-arately. There are nonetheless several areas where they can benefit from working together – large parts of Knorr-Bremse’s product portfolio are based on the same core technologies, particularly pneu-matic safety systems.

While the established tradition of lever-aging synergies within the Company is illustrated by the story behind the devel-opment of Knorr-Bremse’s world-leading disc brakes, the electric screw compressor for commercial vehicles provides an in-

sight into more recent developments. Meanwhile, future cooperation will focus on areas such as the use of environment sensors in automated driving projects in the commercial vehicle and rail sectors.

D I S C B R A K E S : T H E U LT I M AT E E X A M P L E O F T E C H N O L O G Y T R A N S F E RFor many years, disc brakes were only standard on trains and passenger cars. But when Knorr-Bremse started systemat-ically developing disc brakes for com-mercial vehicles in the 1980s, the compa-ny was able to draw on its experience in the rail vehicles sector.

Ultimately, all disc brakes are based on the same operating principle: Brake pads press against the disc, converting kinetic energy into heat. Effective heat dissipation to prevent the brake from overheating is one of the key challenges in developing disc brakes. Knorr-Bremse’s engineers knew that disc brakes produce a more even braking force than the drum brakes that until then had always been used on commercial vehicles. As trucks got ever faster and heavier, this would help to improve handling and steering while brak-ing. Knorr-Bremse therefore decided to develop its own disc brakes for commer-cial vehicles and began marketing and mass-producing them in the 1980s, with great success.


In the words of Dr. Peter Laier, Member of the Executive Board of Knorr-Bremse AG responsible for the CVS division: “Knorr-Bremse’s disc brakes for commer-cial vehicles are a genuine success story. The millionth ST7 disc brake for trailers was recently produced at our Aldersbach facility. In all, we have already sold over 17 million disc brakes. Our screw compres-sor is a similarly groundbreaking project from the more recent past. It shows just how closely the two divisions can coop-erate on certain projects. Together, we were able to adapt and develop the rele-vant products from the rail sector to meet the needs of commercial vehicles.”

T H E S C R E W C O M P R E S S O R : A D A P T I N G A N E S T A B L I S H E D P R O D U C TCommercial vehicle specialists wanted to significantly reduce compressor noise and vibrations on electric city buses. The electric screw compressors that have been used on rail vehicles since the 1980s have a number of systemic advantages here. The commercial vehicle engineers also wanted to offer their own complete subsystem, since the resulting reduction in system complexity would be welcomed by customers.

The screw compressor was adapted to meet the specific requirements of the

commercial vehicles industry. Develop-ment work started at the Rail Vehicle Systems division, where they had already amassed extensive know-how relating to the desired compressor technology. In 2015, responsibility for the project was handed over to the Commercial Vehicle Systems division, who were then able to optimize the delivery rate, design and weight, before commencing volume production of next-generation compres-sors on schedule in 2017. Both divisions agree that the key to the project’s success was the fact that Knorr-Bremse already possessed the relevant expertise in screw compressor technology. Another import-ant factor was that a supplier base already existed from the outset. Building up a supplier base for critical product compo-nents usually takes several years. So here the engineers at CVS benefited from the experience of their colleagues on the rail vehicle side.

D E V E L O P I N G T H E F U T U R E T O G E T H E RAs well as individual components, future collaboration between the two divisions will increasingly be driven by solutions for megatrends such as digitization, eco- efficiency and automated driving. Exam-ples of cross-divisional R&D initiatives include not only collision avoidance systems but also condition monitoring,

remote diagnostics and predictive main-tenance solutions that were originally developed for rail vehicles but now also have applications for commercial vehicles. Moreover, research in the field of electric mobility promises to deliver basic tech-nological solutions that can be used for both electric buses and rail vehicles. Over-all, Knorr-Bremse’s investment in research as a percentage of its revenues is double that of its competitors.

I M P R O V I N G T R A F F I C S A F E T Y W I T H C O L L I S I O N A V O I D A N C E S Y S T E M SCollision avoidance systems such as emergency brake assist and the blind spot assistant for commercial vehicles are already helping to prevent accidents today. Knorr-Bremse is continuing to develop and augment these systems in order to enable automated driving and ultimately driverless operation of commer-cial vehicles. The same applies to light rail vehicles, which at some point in the future will travel through the busy traf - fic in our cities without a driver. Knorr-Bremse is addressing this trend by devel-oping collision avoidance systems with sensors for environment sensing and condition monitoring that can be used in a similar way on road and rail. This is just one of the many synergies that will bear fruit in years to come. Low-cost and

R A L P H H E U W I N G C F O K N O R R - B R E M S E A G

The fact that our product portfolios in both divisions are based on similar technology enables the transfer of know-how and experience – which cuts costs.


Disc brakespowerful sensors will play a key role and will deliver an important competitive advantage. The integration of these sen-sors will provide the basis for innovative vehicle functions such as condition moni-toring of components and systems and environment sensing using cameras, radar or other technologies – areas in which Knorr-Bremse is committed to building cross-divisional expertise.

E C O N O M I E S O F S C A L E“The joint development of digital compo-nents with the CVS division – combined with a common supplier base – generates economies of scale that the RVS division could not achieve on its own. I expect this to deliver cost savings for our rail busi-ness. We will also be able to offer custom-er solutions in a more targeted way and bring them to market more quickly”, says Dr. Jurgen Wilder, Member of the Execu-tive Board of Knorr-Bremse AG responsible for the RVS division.

F R O M R A I L …

Rail vehicles were using disc brakes as long ago as the 1950s. Their benefits included excellent braking

force control, short braking distances and ease of maintenance. As time went by, plans were

therefore devised to replace the standard drum brakes on commercial vehicles with disc brakes.

… T O R O A D

Disc brakes produce a more even braking force on commercial vehicles, too. This helps to improve

handling and steering while braking, which is particularly important for vehicles that are both fast and heavy.

As a result, Knorr-Bremse started developing and mass- producing disc brakes for commercial vehicles in the 1980s.



Highly automated driving is a megatrend. Why? Fewer accidents, greater traffic safety, higher productivity – and the development of a fully connected logistics ecosystem, that’s why. Knorr-Bremse is driving forward the vision of the driverless commercial vehicle by further developing its own products, making strategic acquisitions and engaging in joint ventures. One of the next steps along the road toward the fully automated Highway Pilot will be platoons of trucks with ‘electronic towbars.’

Of driving and being driven

2 5O F D R I V I N G A N D B E I N G D R I V E N

Automation promises to deliver precision, speed and uniform quality − and freight transportation is one area of life that needs to become safer, faster and more reliable in the future. Because the global trend toward urbanization and the eco-efficien cy increasingly being demanded by legis-lators and society are driving a rise in freight volumes accompanied by growing pressure on prices for trucking compa-nies. The digitization of technology looks set to deliver solutions by enabling new and efficient transportation strategies. Automated driving, for example, will give rise to a radically transformed logis-tics ecosystem that will minimize not only the cost and duration of transporta-tion but also energy consumption and the risk of accidents. And for this highly automated supply chain the right trucks will be needed.

The development process began de-cades ago with driver assistance systems such as ABS, ESP and traction control. New developments such as autonomous cruise control, lane keeping systems or emergency brake assist take things a step

further. In 2016 Knorr-Bremse presented its Autonomous Yard Maneuvering sys-tem in which a prototype truck and trailer rig covered a prescribed course within the enclosed space of a truck yard fully autonomously. Where once the on-board systems simply assisted the driver, now the driver’s responsibilities are be -ing transferred step-by-step to the vehicle. Dr. Peter Laier, Member of the Executive Board of Knorr-Bremse AG responsible for the Commercial Vehicle Systems division, is convinced that: “In the next few years we’re going to see a gradual shift from more and more versatile driver assistance systems to automated driving and thus to vehicles that can temporarily take over the driving completely, freeing up the driver to handle other tasks or get some rest.”

A glance at the vehicle manufacturers’ test tracks reveals how far these innova-tions have already advanced. In the technology known as ‘platooning’, several trucks ‘hook up’ electronically, close be-hind one another, and the drivers of the vehicles following the lead truck can

turn their attention to other things. One such platoon was tested as long ago as the early 1990s on the A81 autobahn in southwest Germany in a research project called ‘electronic towbar’ which culmi-nated in the presentation of a two-truck platoon. Even at this early stage, Knorr-Bremse was already involved. Today pla-tooning is significantly closer to volume production than it was back then. Sever al truck manufacturers are testing such platoons in real-world traffic. Along with communication between the trucks, vehi-cle dynamics control plays an important part in ensuring safe and reliable interac-tion between the trucks in the platoon.

C O N T R O L L I N G D Y N A M I C SOne of the challenges in the automation of commercial vehicles is the sheer num-ber of different models involved. And the factors that impact their dynamic handling are not restricted to their length, number of axles and whether they are towing a trailer or semitrailer. There is also the number of driven or steered axles, the load distribution, the height of the center of gravity and many other parameters that exert an influence. Commercial ve-hicle dynamics are far more complex than in the case of cars,” explains Laier. As a leading manufacturer of electronic braking and driver assistance systems,

In the next few years we will see a gradual shift to automated driving and thus to vehicles that temporarily take over the driving completely. D R . P E T E R L A I E R E X E C U T I V E B O A R D M E M B E R , C O M M E R C I A L V E H I C L E S Y S T E M S D I V I S I O N


L E V E L

1L E V E L

2

D R I V E R

A S S I S T A N C E

Based on information about the vehicle envi-ronment, driver assis-tance systems support the driver, for example when steering, acceler-ating or braking. The driver handles all other driving tasks.

P A R T I A L

A U T O M AT I O N

Based on information about the environment, driver assistance sys-tems take over certain steering, accelerating or braking duties from the driver. The driver handles all other driv-ing tasks.

L E V E L

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H I G H

A U T O M AT I O N

An automated system monitors the environ-ment and takes over driving tasks. It may request the driver to take control but can also drive the vehicle without driver in-volvement.

L E V E L

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C O N D I T I O N A L

A U T O M AT I O N

An automated system takes over the driving and monitors the environment. The driver must take control when notified by the system.

L E V E L

5

F U L L

A U T O M AT I O N

The automated system takes over all the driving tasks that a driver would be able to perform in identical road and environmental conditions.

Levels of automation

Knorr-Bremse has a clear edge in terms of knowledge. And controlling the longi-tudinal dynamics of the different com-mercial vehicle configurations is gener-ally considered to hold the key to the highly automated commercial vehicle of the future. But the lateral dynamics too are important in this respect, and here, back in 2016, Knorr-Bremse accessed the steering sector through the acquisition of what is now Knorr-Bremse Steering- Systems. Today, as a systems supplier, Knorr-Bremse is in a position to deliver intelligent, connected braking and steer-ing systems from a single source. These

systems coordinate the automated brak-ing and steering processes, providing greater safety particularly in critical situ-ations, not least by means of lateral guidance which keeps the vehicle safely in lane. Announced in 2018, the acqui-sition of the commercial vehicle steering systems activities of Hitachi Automo tive Systems, Ltd. in Japan and Thailand will reinforce this strategy and underpin the company’s engineering expertise.

M A K I N G D E C I S I O N SNumerous technical questions still have to be resolved before automated driving

on public roads becomes possible. These are focused around the three dimensions of highly automated driving: perception, decision and actuation, and Knorr-Bremse has a sovereign command of all three. One key factor here is the close collabo-ration between Knorr-Bremse and its strategic partner Continental. “With Knorr-Bremse responsible for system leader-ship, our joint goal is to supply turnkey system solutions,” confirms Laier. “But we also draw upon our systems expertise to meet customer requests for individ - ual components or functions.”

T O D AY 2 0 2 0 * 2 0 2 5 *2 0 2 2 * 2 0 2 5 + *

* approximate forecast


The latest developments provide the perfect illustration of how well the two companies’ know-how and existing product solutions complement each other. By way of example, when devel-oping percep tionrelated automated driving functions, they can draw upon established sensor technology already installed in cars and adapt this to the requirements in a truck. At the decision level of automated mobility too, the truck systems build on algorithms already developed by Continental, with Knorr-Bremse handling adaptation to the truck. Actuation along the entire chain of cause and effect is handled by Knorr-Bremse actuators, ensuring fail-safe overall vehicle functionality.

I N N O V AT I V E T H I N K I N GWhen it comes to actuation, Knorr-Bremse with its core expertise in all aspects of vehicle dynamics control is on home ground. In the brakes and steering, Knorr-Bremse controls the two main actu-ators in a vehicle. This also opens up a new way of providing the mandatory fall-back systems, which may seem unusu al at first sight but which offers substantial added value and at the same time cuts costs: When the vehicle shifts into auto-mated driving mode, everything must be designed in such a way that even if an electronic subsystem fails the vehicle can-not run out of control and remains steer-able. To ensure this is the case, either the

safety-critical components must be in-stalled twice over, which makes no eco-nomic sense, or other intelligent ways of meeting these requirements must be found. To ensure that a truck in automated driving mode can always pull over to the side of the road safely, Knorr-Bremse adopted one such way: If the steering fails, selective braking of individual wheels guides the truck safely around a bend or onto the hard shoulder. Steering by braking ensures that the vehicle remains steerable without the need for addition al components.

For 2019 Knorr-Bremse is planning to present a platooning demonstrator using trucks from different manufacturers. Creating a digital connection between trucks of different makes is considered

Automated trucks & platooning

Transfer hub

Shipper

Long-haul traffic

challenging, not least because the han-dling characteristics of the various vehicles have to be aligned with one another so precisely that safe driving within a platoon is assured. According to current estimates, it will be four to five years before platooning capability is ready for volume production. The knowledge gained in the process can also be used for the further development of other automated driving functions such as Knorr-Bremse’s Highway Pilot that enables trucks to handle stretches of autobahn in fully automated mode. This also leaves sufficient time to adapt the legal framework and other background conditions to the new possibilities that technology has opened up – setting an-other milestone on the road to highly automated trucking.


The logistics ecosystem of the future

Partially automated electric truck

Partially automated electric van

Autonomous truck

Delivery drone

Delivery robot

Peri-urban warehouse

Last mile / urban deliveries

Industrial end customers

Urban traffic

Private end customers / households

Urban warehouse

T H E T R A N S F E R H U B M O D E L

Inner-city distribution

The trucking industry is facing major challenges: growing market fragmentation, inefficiency, poor utilization of trucks, a shortage of drivers and ever stricter emissions regulations are putting freight carriers under pressure around the world. On the positive side, global mega-trends such as vehicle automation, electrification and digitization are already defining the business model of the next decades. Step by step we are witnessing the emergence of the logistics ecosystem of the future and this is what it could look like: Platoons of driverless, fully automated trucks handle the long-haul transportation, while partially automated electric trucks and delivery vans look after the first and last mile. To connect up the two modes of transportation there will be transfer hubs with easy highway access. Here the trailers will be

switched from the long-haul trucks to the vehicles heading for the peri-urban and urban warehouses where smaller vans, drones and delivery robots take over. This model enables substantial cost savings to be realized while at the same time meeting ever-increasing customer expectations in terms of delivery times, transparency and flexibility. Platoons of driverless long-haul trucks will lead to significant savings in both personnel and fuel costs. They will reduce the number of accidents which means lower downtimes and insurance premiums. Fuel savings and electric mobility cut emissions and digital booking systems will ensure fewer empty runs. On the last mile to the customer, connected warehouses, vans, drones and delivery robots will lead to substantial increases in speed and flexibility.

Source: Roland Berger, 2018


Today there are 33 cities across the globe that are home to more than ten million people. Just over ten years from now there will be 43 such megacities. And they will all need rapid, safe, clean and reliable transportation solutions for people and freight. Rail networks have a key part to play.

Heartbeat


3 1H E A R T B E AT

Welcome to Delhi in India, its pot-holed streets packed with deafening traffic, standing nose-to-tail in seemingly end-less gridlock. In recent years, traffic density has soared as the city itself has expanded, caught up in exponential growth. At national level, India lines up alongside China as the growth market of the coming decades – and few sectors will feel the impact of that growth more than transportation. One downside here is that the Indian capital currently fills a top slot in the World Health Organization’s air pollution rankings. There are megacities all over the world, but in Asia they are growing fastest. There is an urgent need for transportation infrastructure that meets the needs not only of passengers and freight but of the environment as well. That is what is rapidly taking shape right now and it is proving a growth driver for Knorr-Bremse: “Mass transit within the megacities of Asia and the mainline links between them are attractive projects in which we see major opportunities for growth,” says Dr. Jürgen Wilder, Member of the Executive Board of Knorr-Bremse AG responsible for the Rail Vehicle Systems division.

A M E T R O F O R M I L L I O N SWith Delhi’s population growing at a breathtaking 2.42 percent per annum, the city’s mass transit network needs

to expand to keep pace. Among the major challenges here are the vast urban sprawl and the richly varied nature of the built urban environment. Local trans-portation has to serve the ancient heart of Delhi with its winding alleyways, New Delhi with its generously mapped out colonial boulevards, and the numerous satellite urban spaces with their glass and concrete office blocks and shopping malls.

As long ago as the 1970s, Delhi’s urban planners put their minds to designing a metro network, determined to make it a reality. The rationale was not hard to understand: In rxespect of efficiency and safety, rail is vastly superior to road in downtown areas. Metros, trams and monorails can simply transport more people in less time. Not to mention the topic of emissions.

The complex planning process dragged on until 2001. Then, however, the metro began to take shape very quickly. Just one year later, Line 1 carried its first passen-gers. Today there are eight lines with 327 kilometers of track and 297 trains. And construction work is slated to con-tinue until 2024.

Just recently, Delhi Metro Rail Corporation (DMRC) and Noida Metro Rail Corporation

Mass transit within the megacities of Asia and the mainline links between them are attractive projects in which we see major opportunities for growth.

D R . J Ü R G E N W I L D E R E X E C U T I V E B O A R D M E M B E R , R A I L V E H I C L E S Y S T E M S D I V I S I O N


D E L H I , I N D I A : Gridlock is the normal state of affairs.

E I G H T M E T R O L I N E S have been built in Delhi since 2002. Network

expansion will continue until 2024.

M E T R O U N I T S S E R V E T H E D E L H I M E T R O P O L I S E V E R Y D AY.

297

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(NMRC) opened the Aqua Line. Since January 25, 2019, this has been helping to ease the daily gridlock on the roads of Noida, a city of 642,000 inhabitants on the outskirts of Delhi. The Aqua Line is also linked into the main Delhi metro system. Built entirely above ground, the new line with its 30 kilometers of track serves 21 stations.

E F F E C T I V E B R A K I N G B O O S T S C A P A C I T YWith its innovative braking systems, Knorr-Bremse is helping to boost efficiency and safety on the Aqua Line through Noida. The trains built by Chinese manu-facturer CRRC are equipped with brakes that were also manufactured in China − at Knorr-Bremse’s Suzhou site. The brakes ensure optimal adhesion between wheels and track. This is vitally important, be-cause the contact patch between wheel and track is only roughly the size of a 1-euro coin or a US quarter. So delivering grip during braking and acceleration is far more problematic than in a car, where the contact patch between tire and road is approximately the size of a postcard. To deal with this, ingenious algorithms dis-

D A M M A M

S T AT I O N S F O R M T H E H U B S O F T H E S A U D I C A P I T A L’ S N E W M E T R O .


than a mass transit revolution in Riyadh, with the proportion of passenger jour-neys handled by public transportation set to rise from two to 20 percent.

When the project is complete, six metro lines covering 176 kilometers and serving 85 stations will link the entire metropoli-tan area. The official opening of the metro system and a coordinated network of bus services is scheduled for 2019.

T R A N S P O R T AT I O N S O L U T I O N S F O R D I S C E R N I N G P A S S E N G E R SFor most of the train sets for the Riyadh metro, Knorr-Bremse supplied not only the braking systems – manufactured at Knorr-Bremse plants in Europe – but also numerous subsystems, such as the air conditioning and entrance systems which were also produced by the Group. Out-standing product quality is key to this proj-ect because expectations in terms of on- schedule performance and ride quality are very high indeed. After all, the new mass transit system will have to persuade a pop-ulation accustomed to traveling in the comfort of their own cars to switch to pub-lic transportation.

In line with these aspirations, the new mode of transportation also needs a modern and innovative image. Key fac-tors here include the architecture of the stations and the design and function-alities of the vehicles, not least their air conditioning. The HVAC systems supplied by Knorr-Bremse’s Australian subsidiary Sigma Air Conditioning meet all expec-tations in full. The same applies to the entrance systems which are supplied by Knorr-Bremse Group company IFE in Kematen an der Ybbs, Austria. For one thing, the entrance systems deliver greater safety thanks not least to their obstacle detection capability. And for another, they support intelligent pas-senger flow management, making the whole system more efficient. Optical and acoustic signals facilitate rapid disem-barking and boarding as the train doors open and close, marking the heart - beat of the new transportation arteries that will soon be serving this megacity.

million by 2035. The urban development of the Saudi capital in recent decades has taken its lead from the US model, with a settlement structure resembling a chess board, interspersed with broad bou-levards. However, given the rapid pace of population growth and with mobility based almost entirely on cars, even this sound infrastructure is gradually reaching its limits.

At the same time, the Kingdom is caught up in a process of cultural and economic change. A generously funded package of programs by the name of Vision 2030 is designed to reduce dependency on natu-ral gas and oil and transform Saudi Arabia into a sustainable economy. One aspect of these developments is the expansion of the mass transit network in Riyadh, built around a high-capacity metro system: the King Abdulaziz Public Transport Proj-ect. Saudi media refer to this as no less

tribute the axle load across the rail vehicle in the best possible way. Because if the brake force is optimally transferred to the wheels, the braking distance is minimized. This has decisive benefits because it not only clears the way for higher train fre-quency, which boosts the transportation capacity of the network, but also en-sures greater safety.

R I YA D H : A M A S S T R A N S I T R E V O L U T I O N And now, welcome to Riyadh, capital of the Kingdom of Saudi Arabia. This vibrant metropolis bursting with self-assurance has a history that could hardly be more different from that of Delhi. Back in the 1950s, when the Indian capital was already a bustling megacity, home to millions, Riyadh was still in the early days of its dy-namic development. Today, Riyadh has more than six million inhabitants, and its population is set to rise to almost ten

3 5H E A R T B E AT

From fostering young IT experts in Hungary to providing road safety training for children in China to help them negotiate the urban jungle, Knorr-Bremse employees volunteer their time and expertise to support a wide range of projects around the world. Knorr-Bremse’s “Get Involved” program contributes financial resources and ideas to social projects that employees are involved in as volunteers. It is a way of contributing to local communi-ties in the countries where the company’s products are manufactured and sold, and a way for Knorr-Bremse to fulfill its economic, environmental and social responsibility.

V O L U N T E E R I N G A N D P E R S O N A L I N V O L V E M E N T Volunteering is firmly integrated in Knorr-Bremse’s comprehensive social commitment concept. The con-cept is based on two pillars: Knorr-Bremse Global Care, which helps people in need all over the world, and Knorr-Bremse Local Care – a company program supporting local activities at Knorr-Bremse sites. These include monetary donations, matched giving (match- ing employees’ private donations), corporate volun-teering (allowing employees time off work to support charitable organizations) and the Get Involved initiative (providing financial support for charitable work carried out by employees in their free time). There is a particular focus on education across all age groups, as well as on projects for the environment, health and social cohesion. Knorr-Bremse colleagues are turning their experience and specialist expertise into fascinating and effective edu-cational programs for children in a number of countries around the world, including Hungary and China.

H U N G A R Y : P R O M O T I N G A R T I F I C I A L A N D H U M A N I N T E L L I G E N C EIn Hungary, Knorr-Bremse Rail Systems in Budapest is supporting future IT experts. Knorr-Bremse colleagues have developed a Code Your Robot program for 9 to

Education is the future – everywhereAt each of its sites (over 100 worldwide), Knorr-Bremse plays an active part in helping to shape local communities in a positive and constructive manner. This is something the company does as a matter of course. It also encourages its staff to get involved as volunteers in social initiatives.


3 7E D U C AT I O N I S T H E F U T U R E – E V E R Y W H E R E

14-year-old pupils at the Bókay Árpád primary school, and the company is also making hardware available for the project. György Tarnai, who works for Knorr-Bremse in Budapest, says, “The aim is for Generation Z, the ‘digi-tal nomads’ of tomorrow, to learn early on about the opportunities being opened up by industrial applications in modern robotics.” In his free time, György Tarnai has developed a fun robotics course. Éva Baldavári Juhász, Director of the Bókay Árpád primary school, believes that encouraging children at a young age is very import-ant: “After the virtual exercises, the children can hardly wait to see and program the robots.” This is an effective way of getting boys and girls interested in IT, as István Erdős, Director of Electronic Development at Knorr-Bremse Budapest, confirms: “Our project could be a first step toward training future engineers and technicians.” It appears to be a recipe for success because now there are plans to roll the program out to other schools in Budapest as well.

C H I N A : N E G O T I AT I N G B U S Y C I T Y S T R E E T S C A R E F U L LY A N D S A F E LYThe KBlove Volunteers Community at CVS China has a clear mission statement: “We want to support local train-ing and education. Every child should grow up in a healthy and safe school environment.” The community, set up by employees, launched a road safety program in 2016 called the Children’s Safety Garden. The project covers traffic safety, escape routes in the event of a fire or earthquake, and general advice on how to behave in an emergency. Through role-play games, children learn how to assess critical situations carefully, especially on the roads, so as to avoid accidents. One of these training sessions took place in Shanghai in August 2018, involving 35 children and their families.

S O C I A L S Y N E R G I E SAll Local Care projects – whichever continent they are on and whatever the age range of their target group – are recorded centrally. The aim is to collect and share exam-ples of best practice. There is a dedicated communication platform (the Social Commitment blog) where people can share information and ideas between sites. Wherever possible, Local Care projects are linked to Knorr-Bremse’s other major social initiative – Knorr-Bremse Global Care. Knorr-Bremse Global Care receives financial support from Knorr-Bremse but operates independently of the company. However, it often works directly with Local Care to generate social synergies. In a recent example from Brazil, Knorr-Bremse employees helped Instituto Anchieta Grajaú , a neighborhood initiative supported by Knorr-Bremse Global Care, to set up a learning center to train disadvantaged young people (see “Skills for life”, page 40) and thereby enabled the project to achieve its aims even more effectively.

I S T V Á N E R D Ő S D I R E C T O R O F E L E C T R O N I C D E V E L O P M E N T AT K N O R R - B R E M S E B U D A P E S T

Our Local Care project could be a first step toward training future engineers and technicians.

E U R O S I N V E S T E D B Y K N O R R - B R E M S E T O S U P P O R T S O C I A L C O M M I T M E N T P R O J E C T S .

3.6 million


The pupils in the class for fostering IT talent at the Bókay Árpád pri-mary school in Budapest are crazy about their eight new robots. Knorr-Bremse Rail Systems Budapest provided the robots and eight new laptops for their Code Your Robot project, which teaches the children the basics of robotics. The teaching plan was developed by György Tarnai, an electronic development engineer at Knorr-Bremse Budapest.

E N G I N E E R S O F T O M O R R O W

S A F E I N T H E U R B A N J U N G L E

The KBlove Volunteers Community set up by Knorr-Bremse employees in Shanghai supports local education projects. One of their primary concerns is ensuring children are safe on the roads. Using a film about Knorr-Bremse’s blind spot detection system, Knorr-Bremse experts ex-plain what a blind spot is and what makes it so dangerous. The children are taught road safety rules through games and the messages are rein-forced afterwards in conversations between Knorr-Bremse staff and the children’s families.

B U D A P E S T

S H A N G H A I

3 9E D U C AT I O N I S T H E F U T U R E – E V E R Y W H E R E

Providing prospects, Creating the futureKnorr-Bremse Global Care has been supporting social projects worldwide since 2005. The focus is on water, sanitation, hygiene and education. One current example is the support project of the Instituto Anchieta Grajaú in São Paulo. It enables families to improve the precarious conditions of their settlement built on the institute’s premises. Knorr-Bremse Global Care supports training courses for the residents, who are thus given sustainable opportunities for the future.

K N O R R - B R E M S E G L O B A L C A R E


São Paulo is the business, financial and cultural heart of Brazil. With more than 21 million inhabitants, the met-ropolitan region of São Paulo is the largest industrial conglomeration in all of South America. The companies based here promise a wide range of vocational oppor-tunities for the people who live here and exert a magnetic pull on job-seekers from all over the country. As a result, housing is in short supply. “This means that neighborhood initiatives like those run by Instituto Anchieta Grajaú are a first point of call for families trying to find their bear-ings in this confusing situation,” explains Julia Thiele-Schürhoff, Chairman of Knorr-Bremse Global Care. The independent association set up by Knorr-Bremse em-ployees provides long-term support for a large number of social projects around the world – most of them in countries with Knorr-Bremse sites. The focus is on projects in the fields of education and WASH (water, sanitation and hygiene).

L O N G - T E R M A S S I S T A N C E T H R O U G H E D U C AT I O NThe urbanization process that began back in the mid-20th century triggered the uncontrolled expansion of São Paulo. The majority of the newcomers came from the poor and underdeveloped northeast of the country. Their arrival led to land grabs, unregulated building activity, and the development of temporary settlements and slums – the favelas.

So it was that, in 2013, more than 800 families built make-shift accommodation on a piece of open land with no access to clean drinking water or sanitation. The new-comers were lucky: They had built their settlement on land belonging to Instituto Anchieta Grajaú (IAG). The people at IAG acknowledged that although the families had occupied the institute’s land, they should be allowed to live there and be provided with assistance in improving their homes and resolving the drinking water and sanita-tion issues.

Prominent architect Roberto Loeb, the founder and head of the IAG, made contact with Dr. Rudolf Gerich and Vanessa Gama from Knorr-Bremse Global Care Brazil, which is based at Knorr-Bremse’s Itupeva site in the state of São Paulo, where Loeb had been responsible for planning new buildings in 2013. Together, the team drew up a comprehensive aid concept. Ten model homes were built, but that was just the start. “As well as pro-viding the resources for model houses, we wanted the young people to receive local training in manual trades,” explains Dr. Rudolf Gerich. Roberto Loeb emphasizes how important it is for the assistance to have a lasting im-pact: “This support strengthens the commitment of IAG to educate and care for local children and adolescents. By doing so we also help the parents to structure their daily lives, providing the foundations they need to seek work and new opportunities for their lives.”

4 1P R O V I D I N G P R O S P E C T S , C R E AT I N G T H E F U T U R E

Knorr-Bremse Global Care works through sustain-able project management and the commitment of its employees at sites around the world and in other countries that receive support. The association always acts according to the principle of helping people to help themselves. Entrepreneuri al thinking and a professional approach are important princi-ples for the work of Knorr-Bremse Global Care.

T H E B E G I N N I N GFollowing the tsunami disaster in Southeast Asia, Knorr-Bremse Global Care was founded on January 18, 2005, by employees of the Knorr-Bremse Group as a non-profit organization.

T H E C O R E I D E AKnorr-Bremse Global Care gives people in need a perspective. They are given the opportunity to lead an independent and autonomous life. Together with Knorr-Bremse employees, the association aims to provide long-term assistance by supporting specific projects.

F I N A N C I N G The association is mainly supported by the Knorr-Bremse Group and individual employee donations.

Knorr-Bremse Global Care at a glance

W O R L D W I D E F U N D I N G

H E L P I N G P E O P L E T O H E L P T H E M S E L V E S

P R I O R I T I E S A N D F O C U S E S 270P R O J E C T S W O R L D W I D E

20 million E U R O I N F I N A N C I A L S U P P O R T

700,000 P E O P L E R E A C H E D

WAT E R , S A N I TAT I O N A N D H YG I E N E ( S D G 6 )Water as the basis of life and the way out of poverty

E D U C AT I O N ( S D G 4 )Education as a key criterion for development

I M M E D I AT E A I DA variety of acute measures on humanitarian crises and natural disasters

Location countriesOther countries that receive support

Numbers since the foundation

A F R I C A 29 %

E U R O P E 18 %

A M E R I C A S 17 %

A F R I C A

E U R O P E

A S I A

A M E R I C A S

5,968,032

3,587,514

7,381,832

3,468,183 in euros

A S I A 36 %


B U I L D I N G A N E W L I F EPart of the support put in place for the residents of the settlement is vocational training. So far, 36 people have completed a 5-month building skills course organized by IAG and delivered by SENAI, a vocational training insti-tute. Knorr-Bremse Global Care in Munich funded the course, as well as the construction of a training facility and the provision of materials. The construction sector is the industry with the highest demand for workers in São Paulo. “We train the participants in various trades, from electrical and plumbing skills to roofing,” explains Roberto Loeb. “With their newly acquired skills they can be employed constructing new buildings for the Institute, improve their own homes and find work on the open market. Some of them will set up their own small busi-nesses. The quality of their training means that they can readily access the job market.” Julia Thiele-Schürhoff is delighted with the project: “It sends out a clear message locally,” she says, “especially in terms of the lasting im-pact of the projects we support. People in São Paulo have benefitted from targeted assistance that will enable them to take care of themselves in the long term.”

M O R E L O C A L I N P U T P L A N N E DSuitable projects for Knorr-Bremse Global Care funding, like the one involving Instituto Anchieta Grajaú in São Paulo, are usually identified with the help of employees at the company’s sites around the world. Initially, the support is specific and project-based, with the goal be-

ing to help people to help themselves. Since 2005, Knorr-Bremse Global Care has reached out to assist nearly 700,000 people. In the future, Julia Thiele-Schürhoff intends to ensure that the support provided by Knorr-Bremse Global Care will be channeled more directly and efficiently. “We are currently setting up re-gional organizations in the USA and Hong Kong that will identify, manage and take responsibility for projects in the Knorr-Bremse countries in their regions,” she says. Knorr-Bremse’s own global structure acts as a role model here: Its Rail and Commercial Vehicles divisions finance Knorr-Bremse Global Care, and their local presence not only keeps the company close to the customer but also enables it to assess local needs accurately – for the bene-fit of the company and the social engagement.

E D U C AT I O N A L O P P O R T U N I T I E S for the youngest members of the community give them a better start in life.

Through our activities, we want to continue to encourage people to offer needy people better pros-pects for the future. JULIA THIELE-SCHÜRHOFF CHAIR WOMAN OF THE BOARD OF DIREC TORS OF KNORR-BREMSE GLOBAL CARE

4 3P R O V I D I N G P R O S P E C T S , C R E AT I N G T H E F U T U R E

K N O R R - B R E M S E A G M A G A Z I N E

P U B L I S H E RKnorr-Bremse AGMoosacher Str. 80, 80809 Munich, Germanycorporate.communications@knorr-bremse.comwww.knorr-bremse.com

C O N T A C TAlexandra Bufe, Knorr-Bremse AG

C O N C E P T A N D D E S I G N3st kommunikation GmbH

E D I T O R I A L T E A MIngo Woelk, Alexandra Bufe, Knorr-Bremse; Tobias Rohe, 3st kommunikation; Heimo Fischer; Stefan Schlott; Johannes Winterhagen; Stephan Weiner

T R A N S L AT I O NBauer-Boothroyd

P R I N T E D B YEberl Print, Immenstadt, GermanyPaper: Munken Kristall

P H O T O C R E D I T SAndreas Pohlmann; Knorr-Bremse AG; GettyImages; Shutterstock

S O U R C E Spp. 4 – 5: “World Urbanization Prospects: The 2018 Revision”, UN DESA, 2018

“World Population Prospects: The 2017 Revision, Volume I”, UN DESA, 2017pp. 6 – 7: “World Energy Outlook 2017, Executive Summary”, IEA Publications,

International Energy Agency, 2017pp. 8 – 9: “Machbarkeitsstudie zum Projekt Zukunft Bahn (ETCS/NeuPro)“, McKinsey &

Company for the German Federal Ministry of Transport and Digital Infra-structure, 2018 “Bahnsystem soll digitalisiert werden“, German Federal Ministry of Transport and Digital Infrastructure, downloaded on March 28, 2019 “Signals Set for Growth – how OEMs can be successful in a digitized rail infrastructure”, McKinsey & Company, 2018

pp. 10 –11: “The Era of Digitized Trucking”, PwC Strategy&, 2018p. 29: “Shifting Up a Gear: Automation, Electrification and Digitalization in the

Trucking Industry”, Roland Berger, 2018

carbon neutralnatureOffice.com | DE-141-472502

print production


Key � gures2018 2017

Revenues in € million 6,651.8 6,153.5

EBITDA in € million 1,178.0 1,115.5

EBITDA margin % 17.8 18.1

EBIT in € million 972.5 904.0

EBIT margin % 14.7 14.7

EBT in € million 875.5 852.5

EBT margin % 13.2 13.9

Net income in € million 629.4 587.2

Return on sales after taxes % 9.5 9.5

Earnings per share € 3.68 3.32

Incoming orders in € million 7,001.4 6,656.6

Order book in € million 4,562.6 4,177.0

Free Cash � ow in € million 401.8 450.0

Operating Cash� ow in € million 725.5 679.9

Capital expenditure in € million 308.4 235.2

Capital expenditure in % of sales % 4.7 3.8

F&E costs in € million 363.6 358.8

F&E costs in % of sales % 5.5 5.8

Total assets in € million 6,262.2 5,727.4

Equity in € million 1,607.1 1,995.7

Equity ratio % 25.7 34.8

ROCE % 36.4 37.1

Net Working Capital days‘ sales 46.9 45.8

Knorr-Bremse share

Number of shares 161,200,000 2,600,000

Dividend per share € 1.75 327.00

Employees 28,452 27,705

T H E K N O R R - B R E M S E S H A R EThe shares of Knorr-Bremse AG are listed on the Frankfurt Stock Exchange.

S H A R E H O L D E R S T R U C T U R EStatus: 12/2018

KB Holding GmbH Free � oat

70.16 %

29.84 %

ISIN DE000KBX1006

Common Code 186559398

Stock exchange code KBX

Stock exchange segment Regulated market, Prime Standard

Indices MDAX, Stoxx Europe 600

Stock exchange listing since October 12, 2018

Issue price €80.00 per share

Number of shares 48,360,000

Share capital €161,200,000

Market capitalization at December 31, 2018 €12,673,500,000

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