CEO of Multinational Auto Parts Giant Steps Down Early, Electric Vehicle Division Head Takes Over
CEO of Multinational Auto Parts Giant Steps Down Early, Electric Vehicle Division Head Takes Over：Over 16,000 Employees Laid Off!
On September 11, the global automotive parts industry was rocked by major news: Germany's ZF Friedrichshafen AG, the world's fourth-largest automotive supplier, announced that CEO Holger Klein would step down early by mutual agreement. Effective September 30, Mathias Miedreich, head of the group's electric drive division, will succeed him.
This leadership change coincides with ZF's critical restructuring phase involving large-scale layoffs—revealing the anxiety and self-rescue efforts of this traditional auto parts giant amid the industry's winter.
Behind the Leadership Change: Paving the Way for Restructuring Amid Industry Downturn
ZF's core business lies in supplying automakers with “hardware”: transmissions, hybrid powertrains, and other essential components for the internal combustion engine era. But with sluggish growth in the automotive sector and declining demand for traditional products, the company has initiated restructuring, with “cutting thousands of jobs” as a central measure.
Klein, who took office in 2023, stated bluntly upon stepping down: “The handover of management is now crucial,” aiming to enable the new team to negotiate future plans with employee representatives more swiftly. The implication was clear: the upcoming layoffs and transformation must accelerate, requiring leadership better aligned with the current strategy.
The scale of the layoffs is staggering: nearly 16,000 positions eliminated in just over a year, amounting to a “severe restructuring.”
ZF's downsizing is no minor adjustment. Back in July, the company released a set of sobering figures:
1. Since early 2024, 11,200 full-time positions have been eliminated;
2. An additional 4,700 employees have either signed partial retirement agreements or are awaiting normal retirement. In total, ZF's workforce reduction has reached nearly 16,000 people in just over a year. For automotive parts manufacturers, stable production capacity and technical teams are lifelines. Such large-scale layoffs are nothing short of a major blow.
Executive Shakeup Extends Beyond CEO: Commercial Vehicle Division Head Departs Over “Strategic Differences”
More notably, this upheaval extends beyond the CEO. ZF simultaneously announced that Peter Laier, CEO of its Commercial Vehicle Division, will also depart at the end of September. The official reason cited is “differences in views on the future strategic direction.”
This detail is crucial: it suggests ZF has yet to unify its internal vision—should it continue relying on traditional internal combustion engine components, or swiftly pivot toward electrification and intelligent technologies? Clearly, leaders across different business lines hold divergent views.
New CEO's Background Signals Bet on Electrification, Seizing Industry Growth Opportunities
Midrich's background makes ZF's transformation direction clear: he comes from the electric drive division, where electrification represents one of the few remaining growth opportunities in the automotive industry.
ZF's core businesses—transmissions and hybrid powertrains—face shrinking demand as gasoline vehicle sales decline. Conversely, demand for electric drive systems grows with increased sales of new energy vehicles. Appointing an executive from the electric division as CEO aims to ensure ZF “paces its transformation” effectively, minimizing drag from traditional operations.
Challenges Remain: Leadership Change and Layoffs Are Just the Start; Balancing “Cost Cutting” and “Transformation” Is Key
For ZF, however, leadership changes and layoffs represent only the first step in its “self-rescue” efforts. The automotive industry is currently navigating the painful transition from internal combustion engines to electric powertrains, making life difficult for traditional parts suppliers. They must simultaneously cope with declining demand for conventional products while investing heavily in R&D for electric and intelligent innovations, squeezing profit margins ever tighter.
The real test lies ahead: Can the restructuring succeed? Will the new CEO balance cost-cutting with transformation? Will strategic disagreements within the commercial vehicle division disrupt overall planning? These factors will determine whether ZF can maintain its footing during the industry's winter.
Employees under pressure, industry warning: More companies may face similar challenges
For ordinary employees, this upheaval translates to tangible pressure—the loss of 11,200 full-time positions means thousands of households will see their incomes impacted, with no certainty about further layoffs.
Industry insiders caution that ZF's predicament is not unique. As the automotive industry accelerates its transformation, more parts suppliers reliant on traditional business models may encounter similar challenges. Finding new growth trajectories amid this shift will be a common challenge for these companies.