MAHLE is undergoing a transformational shift, refining its structure to accelerate the implementation of its MAHLE 2030+ strategy. Just two months ago, the company streamlined its Group Management Board, reducing the number of members from seven to four, a decisive move aimed at enhancing agility and operational efficiency.
During his recent visit to India for Bharat Mobility 2025, Arnd Franz, Chairman of the Group Management Board and CEO, MAHLE, shared insights on this bold strategic realignment with Mobility Outlook. He emphasised that MAHLE 2030+ is designed to align with the future of electrification while preserving the company’s stronghold in thermal management and sustainable engine components.
In this strategy, “we combine our strong motivation to enter into the electrification segment with a clear focus on efficient electric drives, motors, and intelligent charging solutions. At the same time, we are committed to expanding our thermal management business, which is evolving beyond just cabin comfort and engine cooling to include motor cooling, thermal management for power electronics, and, most crucially, battery thermal optimisation,” said Franz.
He stressed that effective thermal management is pivotal for electric vehicles, directly impacting driving performance, energy efficiency, and range optimisation. With system-level expertise, MAHLE aims to deliver cutting-edge solutions that maximise the utilisation of stored battery energy, enhancing EV efficiency.
Beyond electrification, the company remains steadfast in its commitment to sustainable combustion technologies. It is actively investing in next-generation engine components that support alternative fuels, including ethanol, bio-LNG, biodiesel, and green hydrogen.
When asked about hydrogen-powered internal combustion engines, Franz acknowledged the company’ strong potential as a near-term, cost-effective alternative to diesel trucks. The hydrogen ICE could be a more familiar and accessible solution for fleets and fuelling stations, offering a cost structure closer to today’s diesel trucks. “With the right infrastructure and support from OEMs like Tata and Cummins, we can expect to see hydrogen-powered trucks on the road soon,” he explained.
Strategic Resilience
Reflecting on the past year, he said the company faced a complex global landscape shaped by fluctuating market dynamics and the evolving transition to electrification. While India has remained a beacon of growth and optimism, the same cannot be said for regions like Europe and North America, where demand fluctuations and a slower-than-expected ramp-up of electric vehicles (EVs) have impacted volumes. These factors contributed to a decline in its global sales by over a billion Euros between 2023 and 2024, he said.
Despite these challenges, MAHLE’s proactive approach to operational efficiency has enabled it to stay on course. The company initiated a profitability and cash flow improvement programme over two years ago, which has strengthened its financial foundation even amid market volatility. Additionally, a strategic reorganisation, which was undertaken last year, will enhance agility and cost-effectiveness. The company consolidated its business units from five to three, streamlining operations while ensuring a balanced approach to both internal combustion and electrification.
Under the new structure, the Powertrain & Charging division will integrate its Engine Systems & Components business and Electronics and Mechatronics, reinforcing its position as a key player in both traditional and emerging propulsion technologies. The Thermal & Fluid Systems division will combine Thermal Management and Filtration and Engine Peripherals, strengthening its capability in energy-efficient vehicle systems. Meanwhile, the newly formed Lifecycle & Mobility division will go beyond conventional aftermarket solutions, expanding into diagnostics, workshop innovations, and data-driven business models, he explained.
This structural shift positions MAHLE to respond more swiftly to industry transformations while ensuring a well-calibrated balance between optimising internal combustion engine components and accelerating its offerings in electrification. 'We don’t know exactly how fast the transition to electric vehicles will unfold, but our new organisation makes us faster, leaner, and more cost-effective. It allows us to support our customers with cutting-edge solutions for both traditional and next-generation mobility,' Franz said.
Outlook For 2025
As MAHLE looks ahead to 2025, the company maintains a cautious yet strategic approach to navigating a global market characterised by economic uncertainties, evolving regulations, and shifting consumer preferences. According to Franz, outside India, the overall market is expected to remain flat, with key regions facing distinct challenges. Europe grapples with new regulatory frameworks and persistently high interest rates, while the United States remains uncertain amid the transition to a new administration.
Meanwhile, China, though a highly competitive and dynamic market, continues to be influenced by government policies and a fiercely contested landscape between international and domestic OEMs, spanning combustion engine, hybrid, and battery electric vehicles, he said.
Despite the complexities of global markets, the company sees significant opportunities for growth, particularly in India. 'I am as bullish—if not more bullish—on India than I was last year,' he mentioned. India has already surpassed Germany in vehicle production and is on track to overtake it in GDP, given the country’s rapid economic expansion. This growth presents immense potential for the automotive sector, driven by rising incomes, increasing vehicle ownership, and a strong manufacturing ecosystem.
Franz highlighted that the company is well-positioned to support this momentum, catering to a diverse range of vehicle categories, from two- and three-wheelers to passenger cars, SUVs, light commercial vehicles, heavy-duty trucks, and off-highway applications. With cutting-edge technology, a robust manufacturing footprint, and a highly skilled workforce, the company is poised for accelerated growth, targeting a shift from a high single-digit to a double-digit compound annual growth rate in the coming years, he pointed out.Strengthening India’s Role In Global Manufacturing, Exports
With India’s rapidly expanding automotive landscape and its strategic position as a cost-competitive manufacturing hub, MAHLE sees significant opportunities to leverage the country’s potential for exports. Given the evolving geopolitical landscape, India is increasingly positioned as a viable alternative for global supply chains, he opined.
While the company’s primary focus remains on serving the domestic market, the company anticipates an indirect boost in exports as its customers ship India-made vehicles to international markets. Additionally, it envisions growing its own export ratio from its Indian operations, aligning with the country’s broader ambition to become a global manufacturing powerhouse.
However, the core strategy for MAHLE in India revolves around strengthening its local production footprint to meet the surging demand within the country. With India set for sustained growth in the coming years, the company aims to expanding its capabilities, ensuring that its advanced automotive technologies seamlessly integrate into the evolving mobility ecosystem while contributing to India’s emergence as a key player in the global automotive supply chain.
Driving Innovation, Synergies Across Business Verticals
With restructuring the organisation into three streamlined business verticals, the company is strategically aligning its resources to unlock new growth opportunities. A key driver of this transformation is MAHLE New Ventures GmbH, an innovation incubator launched in 2022, aimed at expanding the company’s technological expertise into emerging applications.
One such initiative under this programme is ‘chargeBIG MAHLE,’ an innovative approach to distributed charging. This solution optimises existing infrastructure, enabling simultaneous charging of multiple vehicles without requiring extensive capital investments in buildings or power grids. While its primary focus remains on Central Europe, the company sees immense potential for its adoption in India, where scalable and cost-efficient charging solutions are critical to accelerating EV adoption. Beyond charging, MAHLE New Ventures is actively exploring opportunities in energy management, safety, and other high-impact domains, leveraging its deep-rooted engineering expertise.
In addition to fostering innovation, the company’s restructuring also enhances cross-functional synergies across its three business units. The two verticals serving OEM customers—Powertrain & Charging and Thermal & Fluid Systems—have key areas of overlap, particularly in electric compressors, which are an integral component of both powertrain solutions and thermal management modules. Franz concluded the discussion by emphasising that this integrated approach enables the company to deliver cutting-edge solutions while maximising operational efficiency, firmly positioning itself at the forefront of the evolving mobility landscape.
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