Mr. Schüler, our focus topic in this issue is “Precision.” For 80 years, Schaeffler has stood for high-precision parts, components, and systems. How does precision define daily routines in the Vehicle Lifetime Solutions division today?
Precision is acquiring an all-new dimension for us today. We’re no longer moving around in just one vehicle world but in several worlds at the same time: internal combustion engines, hybrid electric and fully electric vehicles, plus more and more electronics, software, and connected functions. At the same time, vehicles are being used for longer periods of time. That’s why, for us, precision not only means precise production of a component. Even many years later, we still need to know what part, what information, and what technical solution belongs to exactly this vehicle and repair case. The greater the variety becomes among existing vehicles the more crucial will this capability be.

“Our business is developing further: from that of a product supplier to a partner in the entire repair process.”

The Aftermarket business at Schaeffler is a standalone division with sales of 3 billion euros. What basically distinguishes that business from the classic new-parts business?
In the new-parts business, the initial focus is on the development and production of a vehicle. Our view is directed toward the entire subsequent utilization phase. But going forward, these two worlds can no longer be imagined strictly apart from each other. As vehicles are becoming more technologically complex and are increasingly defined by electronics and software, repairability must be included in thought processes at earlier stages. What components can still be repaired later? What data are needed for repairs? And how do we ensure that a vehicle will remain serviceable even after many years? That’s exactly where our business changes: we need to intensify our thinking based on the entire lifecycle and ideally consider what’s going to be needed as early as in the development stage.

At Schaeffler Vehicle Lifetime Solutions, you keep tens of thousands of parts in stock, in some cases for more than 25 to 30 years. That’s probably backed by a high-precision logistics concept, right?
That has long ceased to be strictly a logistics concept! The real challenge is to ensure availability for decades. When regular production ends volumes drop, production capacities change, and classic supply chains at some point no longer function the way they used to. That’s why we need a variety of solutions, depending on the product: We use existing manufacturing structures and external sourcing. We’ve also adopted production capacities for that purpose, enabling us to continue manufacturing selected products. What ultimately counts is that a required part is still available long after the original mass production has ended.

Today, value creation in the Aftermarket sector goes far beyond the spare part per se – and toward complete repair solutions including precision installation guides for mechanics. How important are such services that go beyond the spare part?
In the future, a spare part will only be an element of a successful repair. The more vehicles are defined by electronics and software the more decisive will be the aspect of interaction: can the garage detect the fault? Does it have access to the necessary information? Is the right part available? Do the tools and knowledge for installation exist? And can all these elements be connected to each other as smartly as possible? That’s exactly where our business is developing further: from that of a product supplier to a partner in the entire repair process. For us, this means combining the product, information, garage support, and future increasingly digital services in ways that make a repair possible in the first place.

You expect ICEs to remain dominant in the Aftermarket for a longer period of time, not least because the fleet of existing vehicles as a whole is getting older. At the same time, electric mobility is picking up pace. All that’s happening in very different ways from region to region. How can precise planning be accomplished in such a volatile market environment?
We don’t plan according to a single future scenario but according to the reality of existing vehicles. The decisive aspect for us in the Aftermarket business is what vehicles are actually on the road, how they’re being used, and what the resulting repair requirements are. And that reality entails a great deal of regional variety. That’s why we combine global economies of scale with strong regional market proximity. Data, digital tools, and, increasingly, AI help us recognize developments early and control our portfolio and inventories accordingly. For us, it’s clear that ICEs, hybrid electric and fully electric vehicles are still going to be on the road in parallel for a long period of time. That’s why we’re committed to providing precisely the portfolios for these different technologies and markets that they really need.

Do the high manufacturing precision, excellent quality, and strong market attractiveness make Schaeffler products particularly “attractive” to product pirates?
Of course, quality makes a strong brand attractive also to product pirates. But for us, that’s about far more than the resulting economic damage. Our customers and the garages must be able to rely on something bearing a Schaeffler label really containing Schaeffler quality. That’s crucial especially in the case of safety-related components. That’s why we rigorously emphasize brand protection, product security, and traceability because in the end trust in the quality and safety of a repair is what matters.

“As electric vehicles get older, the ability to precisely assess the actual condition of the battery and to derive the right technical solution from that assessment becomes increasingly important.”

Jens Schüler, CEO of Schaeffler’s Vehicle Lifetime Solutions division

In the electric mobility business, Schaeffler is increasingly focused on the highly competitive Chinese market – why China as a focus?
For us, China is far more than a fast-growing market for electric mobility. There we can see how new ecosystems are increasingly developing around new vehicle technologies, in which vehicles, data, software, and services interact more and more intensively. For us, it’s important to understand this evolution early on and to derive from it what new requirements in terms of repairs and service are emerging.

A good example is the battery. As vehicles get older, the ability to precisely assess the battery’s actual condition and to derive the right technical solution from that assessment becomes increasingly important. Especially at that point, precision acquires a new meaning: not only in terms of manufacturing a component but in terms of assessing complex systems throughout their entire lifecycle.

That’s why China for us is also an important market for learning how the lifetime service business is changing in new ecosystems like that and what capabilities we’re going to need for that going forward.

With the acquisition of Vitesco, Schaeffler has augmented itself especially in the fields of electronics and power electronics. In concrete terms, what does that augmentation mean for the repair business of tomorrow?
With Vitesco, we’ve gained additional expertise in electronics, power electronics, and technologies for electric vehicles. For us at VLS , that’s a great opportunity because it opens up new repair fields, for instance in thermal management, with electronic systems, and on the e-axle. But, again, the crucial aspect is that we don’t want to simply feed individual products into the Aftermarket business. Our strength lies in making these technologies usable for the Aftermarket and to develop tangible, economically sensible offerings for our customers from that. In that way, we can combine mechanical, electronic, and digital expertise even more intensively and support vehicles across various technologies throughout their entire lifecycle.

In an interview you said that fewer parts in the field of electric mobility doesn’t necessarily mean lower sales. Can you explain that sentence?
Because value creation doesn’t depend on the number of parts. An electric vehicle has fewer classic wearing components. Instead, new requirements emerge regarding electronics, power electronics, software, and in the future, also in terms of diagnostics and data-based services. Consequently, the creation of value increasingly shifts from a single component toward systems and services. And that’s precisely where opportunities lie for us. When a complex system does not need to be replaced completely but can be systematically serviced, repaired, or reconditioned that leads to other forms of customer benefits and thus new business models as well. That’s why fewer parts do not automatically mean less business. It primarily means other business.

In-vehicle software is becoming increasingly important. The industry even refers to software-defined vehicles. What does that development mean for the Vehicle Lifetime Solutions division? And what does it mean for the customer? Will software also define a vehicle’s lifetime in the future?
Software changes the question of what “lifetime” in the case of a vehicle means in the first place. What happens to a vehicle that mechanically is still working perfectly when ten or fifteen years later software, electronic components, or necessary data are no longer readily available? Precisely that’s going to be one of the great challenges confronting the lifetime services business.

That’s why, in the future, repairability will mean more than the availability of a spare part. A vehicle must still be diagnosable after many years, relevant data must be usable, and hardware and software must interact in the repair process. At the same time, the technology is changing faster and faster while vehicles are being used for longer periods of time.

For us, that creates a completely new task: We must think today about how the technologies of tomorrow will remain serviceable and repairable even across long periods of time. Diagnostics and data-based services are going to play an important part in that regard. That’s why the crucial question of the future will not only be how long a vehicle can run technically but how long we’ll be able to sustain its technological functionality without security gaps emerging for the user.