German automotive supplier ZF is reportedly exploring a complete spin-off of its ‘Electrified Drive Technologies’ division under the internal project name ‘Verde,’ according to a Handelsblatt report. The move, if confirmed, would mark a significant restructuring beyond previously announced cost-cutting measures.
The financially strained company had previously announced plans to cut up to 14,000 jobs in Germany, primarily within the ‘Electrified Drive Technologies’ division, which includes electric drives, plug-in hybrid transmissions, and combustion engine components. While individual site closures and potential technological partnerships were considered, a full spin-off had not been publicly discussed until now.
The proposed spin-off would affect more than 32,000 employees and account for approximately €11.5 billion in annual revenue—representing nearly a quarter of ZF’s total sales. The restructuring could impact major facilities, including the e-drive division’s main site in Schweinfurt, ZF’s headquarters in Friedrichshafen, and the transmission plant in Saarbrücken.
A ZF spokesperson acknowledged that the company is assessing “strategic cooperations and partnerships” to restore profitability and secure future investments but declined to comment further on internal deliberations.
If the spin-off proceeds, it would be a symbolic shift for ZF, which was founded in 1915 as a manufacturer of transmissions for motorized vehicles and aircraft. The move would be comparable to Continental’s spin-off of Vitesco Technologies but could have an even larger impact on ZF, given its historic reliance on drivetrain components. The company would retain operations in chassis solutions, electronics, commercial vehicle systems, and passive safety technology.
The future of the spun-off division remains uncertain, as potential buyers have yet to emerge. Handelsblatt suggests that German competitors such as Bosch or Schaeffler are unlikely candidates due to antitrust concerns or recent acquisitions, such as Schaeffler’s takeover of Vitesco. Possible interested parties reportedly include Hyundai Group’s supplier Hyundai Mobis and Taiwan-based Foxconn, which already holds a stake in ZF’s axles division.
Despite securing record orders worth over €30 billion, ZF’s e-drive division is believed to have accepted contracts at prices that could lead to losses in the mid-single-digit billion-euro range over the next three years. “If we complete the orders in full, we will make a loss,” an insider told Handelsblatt. This financial burden could affect the attractiveness of the spin-off for potential buyers.
While no buyer has been confirmed, ZF management is reportedly aiming to complete the spin-off within 2024, with a potential sale in 2026. However, Handelsblatt notes that ZF is still in the process of assembling a team to facilitate the spin-off, indicating that key preparations remain unfinished.