Berlin, December 8, 2017
ZF Friedrichshafen has announced that its CEO Stefan Sommer would leave the company, signaling the end of an expansion strategy. During his term, which lasted all of five years, Sommer’s expansionist tactics have led to the German supplier's $ 12.4 billion acquisition of TRW Automotive, creating the industry's second-largest partsmaker. His resignation is to be effective immediately with Konstantin Sauer, company CFO to be appointed as interim CEO.
The reason for the split seems to be the internal power struggle and the shakeup of key positions in the company. Former Audi and Bentley CEO Franz-Josef Paefgen was appointed as Chairman after Giorgio Behr, who previously held the post stepped down. He was considered to be Sommer’s strongest ally in the company.
"We would like to thank Dr Sommer for his long-standing, successful employment in the company. In his five years of service as the head of ZF, Dr Stefan Sommer has developed the company with tireless commitment and great vision," Paefgen said in a statement.
In an effort to reduce dependence on combustion engine cars, Sommers attempted to buy out several companies so that ZF could be transformed into a leading technology company in e-mobility and autonomous driving. This has however led the company into debt which is now under pressure from shareholders to resolve.
The company is partly owned by the city of Friedrichshafen through a foundation and the mayor of the city also sits at the supervisory board. The struggle has been between the management and city hall regarding an acquisition in the United States, says a Reuters report. Mayor Andreas Brand was of the opinion that the company needs to reduce debt and increase dividend payments.
“It is vital to settle down now and concentrate on our business and the future transformation of the automotive industry,” Paefgen said.