After the lockdown in many regions, Baumot customers restart their regular operations. The incoming orders at Baumot “picked up speed again very quickly”, as CEO Stefan Beinkämpen explains in an interview with the editorial team of Personal-Financial.com. During the interview, Beinkämpen goes into detail about the various personnel decisions at Baumot. He talks about development work in society and makes it clear that the aim is to expand the product portfolio. This is how they work on the use of Baumot products in new drive concepts.
Personal-Financial.com: How did Baumot get through the second quarter? The consequences of the corona pandemic have left deep marks in the automotive industry if you look at the latest quarterly figures from the industry.
Leg combs: Our business is mainly driven by the legal framework as well as the government subsidies for retrofitting that are granted in practically all countries. That is why the lockdown hit us, because workshops were closed in many of our target countries and the bus fleet operators, for example, had temporarily stopped work. However, unlike the vehicle manufacturers, we are less dependent on the economy, on the contrary: many fleet operators are currently postponing new acquisitions and prefer to use state-funded retrofitting instead.
Personal-Financial.com: To what extent are the operational activities of the Baumot Group and its partners currently still being restricted by the consequences of the pandemic – also internationally, for example in Italy or Great Britain?
Leg combs: Of course we still feel the consequences. It takes time to restart after several weeks of lockdown. Not only for us, our suppliers also have to “get going again” and our customers are only gradually increasing their regular operations. On the positive side, however, we see that incoming orders have picked up speed again very quickly after the lockdown, so that we also assume that sales will soon be back as planned.
Personal-Financial.com: In the last interview you mentioned that owners of Euro 5 diesel vehicles should have used the lockdown time “to deal more intensively with the subject of retrofitting”. Is this noticeable in your incoming orders?
Leg combs: In any case: we always see the number of visits to our website and of course we also register all appointment requests and orders. The number of visitors was consistently high at all times and we continued to see great interest in the appointment requests during the lockdown. However, and that is quite logical, the customers did not want appointments immediately during the hot phase of the lockdown, but were interested in retrofitting in September or October. We are now working through the dates that have already been agreed for now and the coming days and weeks as planned.
Personal-Financial.com: In the latest press release, your colleague on the board, Marcus Hausser, said that Baumot was “strategically and operationally ready for a step into a new chapter in the company’s history”. What exactly is meant by this – from the point of view of the operational business?
Leg combs: The Chancellor made it clear to both the EU Council Presidency and the Petersberg Climate Dialogue that climate remains on the agenda. Climate and health protection is the topic for the coming years and will have a strong influence on the economy and politics.
This creates opportunities today and in the future to bring the vehicle fleet up to the state of the art with technical upgrades. According to the KBA, the current vehicle fleet (passenger cars) amounts to 47 million vehicles. Even with the proportion of 7 to 10 million electric vehicles forecast by the federal government in 2030, around 40 million cars with conventional drives will remain in the fleet.
Every vehicle that is sold today is a customer of tomorrow, and this naturally also applies to hybrid drive concepts. Strategically, it is therefore necessary that we are technically even broader and can quickly provide a retrofit solution for every area of application in the future.
Accordingly, in addition to the solutions for diesel vehicles, we also look at solutions for gasoline vehicles, such as the Otto particle filter, and can also approve and offer corresponding products here as soon as the legal requirements are met.
Personal-Financial.com: A second factor that Hausser has addressed is the announced change in the top position from Hausser to you. Why this step? What is the background?
Leg combs: Marcus Hausser has successfully managed the company for many years and, after the new investors joined in mid-2012, discharged and internationalized it. This work was completed with the completion of the turnaround at the end of 2019. For the future, we are now increasingly relying on new technical developments and, in addition to retrofit products, also on solutions for the vehicle industry. To this end, and we decided to do this a few years ago, a new direction also makes sense in management.
Personal-Financial.com: An additional person is to be appointed to the board of directors in the further course of the year. By when should the personnel be completed and who is Baumot looking for?
Leg combs: We currently have some very suitable candidates in mind, but will wait until the new Supervisory Board has been constituted before appointing them. It is planned that we will appoint another board member this year.
Personal-Financial.com: How will the work on the board of directors be distributed in the future?
Leg combs: We will structure the tasks on the board of directors in a similar way to today’s division. The operational tasks relating to the Passenger Cars and Commercial Vehicles divisions and the strategic tasks relating to the product portfolio and strategic orientation will play an important role.
Personal-Financial.com: There will also be changes in the supervisory board. What is the reason for this?
Leg combs: With Dr. Zemke and Mr. Spittler, we had two proven experts on board for the renovation. With the completion of the turnaround, the time has come for a change here too, similar to the management board. Dr. Schwaderlapp, who will continue to be a member of the supervisory board with a focus on technology and development and will continue to play an even stronger role there in the future, will be provided by two experienced supervisory boards with a focus on M&A and cooperations as well as proven expertise in the area of transactions and proximity to university research is supported.
Personal-Financial.com: The numerous personnel changes that are pending could be seen as a pointer to an upcoming new direction at Baumot, especially since the diesel retrofit business has been popular since the diesel scandal, but will be a business with a manageable time horizon . Is that true?
Leg combs: This may only be true in relation to diesel. However, we increasingly see the opportunities in using our products in new drive concepts. We filter particles and reduce nitrogen oxides, not only because of the diesel scandal, but also because of the high and steadily increasing demands on the air we breathe. So far, this has mainly been the case with diesel engines, but for some time it has also become more and more important for gasoline engines and of course for new drive concepts.
And we have to understand that technical upgrades become part of the product life cycle: something that is already normal today in other mobility concepts such as trains, ships or planes. The vehicle customer expects that he can use his vehicle investment over the average holding period of almost 10 years. This is not yet normal today – but we can see from the retrofit funding of 3,000 euros per vehicle that the manufacturers, especially Daimler and Volkswagen, have understood this and are actively supporting it.
Personal-Financial.com: Baumot has already announced new products and is already developing them, including in the area of e-fuel vehicles. What is the status of the ongoing development projects and when can such new products come onto the market?
Leg combs: Synthetic fuels are a very important building block for the vehicle industry. Our development work involves a combination of a nitrogen oxide reduction system and synthetic fuels. The results have shown that vehicle emissions can be reduced by up to 85 percent and this is not the last word. At the beginning of the year we announced the presentation of a near-series upgrade in a Passat, but unfortunately had to cancel the event with a larger audience due to the corona. We are now planning to present this vehicle and other modern solutions that can be used at any time in October.
Personal-Financial.com: In which direction do you want to stretch your feelers when developing new products in the future?
Leg combs: As already indicated, our product portfolio today mainly serves diesel vehicles. Due to the increasing share of petrol vehicles, we are also thinking about climate-friendly and low-emission offers here. We also have solutions in the drawer to retrofit gas or hydrogen-powered vehicles in addition to the aforementioned gasoline particle filters and thus make them even cleaner.
Personal-Financial.com: Would the takeover of tech providers be an issue in this area, or do you rely solely on your own developments, possibly in cooperation with partners such as HWT Saar in the field of e-fuel vehicles?
Leg combs: We are open in all directions here. The institutes of the universities offer many possibilities here, but cooperation with other companies is already the subject of many discussions. Corona has certainly affected our current business from the second quarter of this year. What we have also seen, however, is that this “corona shock” has opened many doors to new technologies, new approaches and, last but not least, new ways of cooperation and marketing than we would have experienced without the crisis. Because right now all companies have to open up even more to innovative technologies. And this is exactly what we are well positioned for today.
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