Annual Report 2014 Corporate Website

Major markets by regions

Asia

Oerlikon has been active for many decades and is well positioned in the growth markets of Asia, with the region contributing 39.4 % of Group sales in 2014. The Group has the competencies and experience to satisfy the exacting needs of Asian customers and to meet the demands of the growing Asian population and emerging middle class. Thanks to its strong presence and long-standing relationships with Asian customers, Oerlikon understands the cultural characteristics and requirements of the local markets. This enables the Group to operate successfully and grow the business sustainably in Asia. Oerlikon operates in eleven countries in the Asia Pacific region, with a stronger focus in China and India.

In 2014, China was responsible for 28.1 % of Oerlikon Group sales. Over 1 800 employees are employed locally at 27 sites. This strong position is mainly attributable to Oerlikon’s consistent focus on anticipating and satisfying Chinese customers’ specific requirements, and to trusted relationships built over the years. In 2014, the Manmade Fibers Segment celebrated its 50th year of business success in China. The Vacuum Segment has been operating in the country since 1985. The Surface Solutions Segment opened its first coating center in 2004, and to date already has a network of 15 centers distributed all over the country. The country chief representative team in Beijing and Shanghai, together with the shared service center in Suzhou, has been playing a key role in Oerlikon’s expansion in China. At the Oerlikon Suzhou Industrial Park, support is provided to all Segments in central services such as IT, finance, HR, administration and staff development. The country chief representative team offers regional business support to all Segments in China to accelerate their business growth. China takes a “One joint Oerlikon in China” approach, focusing on an “In China for China” business model to drive long-term profitable growth.

In India, Oerlikon is represented at 18 sites with around 2 600 employees and achieved 3.0 % of Group sales in 2014. The subcontinent is forecasted to grow about six times faster than OECD countries. The activities of Oerlikon in India, as in China, are focused mainly on the growing domestic market. The Surface Solutions Segment has been operating in India for 20 years. To date, it has a network of ten service and production centers and is further expanding in step with the growth of the automotive industry. India is also a strategically important market for the Manmade Fibers Segment, which has been in the country since 1984. The Drive Systems Segment has been represented on the subcontinent since 1999 and operates two large production facilities, primarily for drive systems used in agricultural tractors, construction machinery, commercial vehicles and industrial applications. A third plant is under construction and will be fully operational in 2015. Due to the increasing demand for pumps and vacuum solutions, the Vacuum Segment opened a South Asia head office in Bangalore in 2014, as well as sales and service centers in Baroda and Mumbai to tap the opportunities of the local market and support customers more efficiently.

Europe

Europe continues to be an important base for Oerlikon’s worldwide operations, and the region accounted for 36.1 % of Group sales in 2014. The Group employs more than 8 000 employees at 94 sites, which corresponds to over half of the global workforce. The region continues to host the Group’s key research and development centers. For example, one of the world’s most advanced manmade fibers technical centers is located at the Segment’s headquarters in Remscheid, Germany. Other important innovation sites are at Balzers in Liechtenstein and Wohlen in Switzerland, where market-leading technologies for surface solutions are developed under the Oerlikon Balzers and Oerlikon Metco brands, respectively. At five sites in Italy, the Drive Systems Segment develops and produces its innovative drive solutions for high-performance sports cars, electric and hybrid vehicles, as well as high-precision gear solutions for the major leading manufacturers of agricultural, construction and commercial vehicles. The Vacuum Segment conducts an important part of its R&D activities in Cologne, Germany.

In recent years, Oerlikon has further invested in its European sites so that they remain globally competitive in the long run. Production processes for the Manmade Fibers Segment, the Drive Systems Segment and the Vacuum Segment have been optimized, and offices in Eastern Europe have been established to exploit potential business opportunities.

The Americas

North America accounted for approximately 19.7 % of Group sales in 2014. The Group employs a total of over 2 100 employees at 39 sites in the Americas. The Surface Solutions Segment operates a dense network of 33 service and production centers in North and South America, of which 21 are located in the USA, where the Segment is a major supplier to the US automotive industry, as well as to major customers in the aerospace, energy and food industries. The Manmade Fibers Segment is located in North Carolina as a service provider to the manmade fiber producing industry, in particular to the manufacturers of bulk continuous filaments (BCF). In Indiana, the Drive Systems Segment develops and produces planetary drives and special transmissions for agricultural and construction equipment, as well as custom drives for oil and gas and mining machinery. The Vacuum Segment counts various research institutes in the USA among its customers. In South America, the Group’s business is focused primarily in Brazil, the largest and fastest-growing economy, where all four Segments have their own branches.