n December 2022, the Freudenberg company SurTec International GmbH in Bensheim, Germany acquired Munich-based omniTECHNIK Mikroverkapselungs GmbH, which specializes in thread-locking products. The transaction included the acquisition of all shares of Precote USA LLC, East Lansing, Michigan, USA, by SurTec Inc. of Upper Arlington, Ohio, USA.
Last year, Freudenberg hired about 7,800 employees. That is about 1,000 more than during the previous year and an increase of 14 percent. Europe, North America, China and India were the main focuses of the hiring.
As of December 31, 2022, Freudenberg Group had more than 51,000 employees of 146 different nationalities, working in 60 countries. There was growth in every region: Employment rose to 12,413 in Germany (previous year: 11,918); to 14,924 in Europe, excluding Germany (previous year: 14,450); to 11,867 in North America (previous year: 11,528); to 10,711 in Asia (previous year: 10,474); to 543 in Africa/Australia (previous year: 542); and to 1,004 in South America/Central America (previous year: 924).
Freudenberg is investing in training for young people: During 2022, 123 people began training programs (previous year: 91) at Freudenberg companies in Germany. That is roughly one-third higher than the figure for the previous year. In all, 351 people were in training programs in Germany alone. The company also provides training in 14 other countries.
Mobility: Preparing the battery and fuel cell businesses for the future
Freudenberg products are driving forward-looking topics like the energy transition. The Freudenberg Group is investing in the mobility of the future – in battery, hydrogen and fuel cell technologies, along with high-tech components for commercial vehicles. The strategy is working, as shown by a sales increase of about 50 percent for components, for example.
Based on opportunities for growth, a new Business Group – Freudenberg e-Power Systems – was formed in April 2022. Building on its extensive experience and expertise in battery and fuel cell technologies, the company is offering emission-neutral energy systems for heavy-duty applications. About 100 experts are already working at Freudenberg's fuel cell technology center in Munich. The Business Group has achieved a milestone with the world's first type-tested methanol-fueled fuel cell system for the maritime sector. The system makes it possible for oceanic shipping to operate climate-neutrally, efficiently and safely.
Freudenberg e-Power Systems has also finalized a collaborative project with the automotive supplier ZF Friedrichshafen. The goal is to develop a fuel cell and battery drive system as well as the components for it. These emission-free fuel cells will replace conventional diesel powertrains in buses and trucks and find uses in maritime applications. Road tests of the first prototype vehicles and the launch of series production are expected this year.
Freudenberg e-Power Systems and LG Energy Solution have signed a multiyear contract for the delivery of lithium ion battery cell modules, enabling Freudenberg to expand its capacity and keep up with rising demand.
In early January 2023, the Business Group acquired the remaining shares of XALT Energy, LLC, Wilmington, Delaware, USA. To that point, Freudenberg had held 50.1 percent of the shares in the joint venture. XALT Energy manufactures lithium ion battery cells, and its subsidiary Freudenberg Battery Power Systems, LLC, Wilmington, Delaware, USA, develops and produces complete battery systems.
Climate-neutral by 2045 – a multistep strategy
“We are driving the energy transition,” Sohi said. “One example is the expansion of the battery and fuel cell business. Another is our ambition to be climate-neutral by 2045.” Freudenberg is turning to a multistep strategy of energy savings, electrification, and purchases, along with compensation for CO2 emissions and its own production of green electricity. This is making the in-house generation of green electricity increasingly important. The approach mainly relies on photovoltaic systems on the roofs of buildings at Freudenberg facilities around the world – from China to Mexico to Spain.
Freudenberg is supplementing its in-house power generation programs with the purchase of green energy. The Freudenberg Group is considered to be a reliable partner, enabling it to conclude long-term contracts with energy companies for the supply of green energy. In one case, solar energy is being supplied by the Tramm-Göthen Solar Park, the largest facility of its kind in Germany. In another, the company receives a share of the electricity produced by the Offshore Windpark Nordsee Ost. At the end of 2022, Freudenberg sites in Denmark, Sweden and Austria were purchasing 100 percent green electricity. Other sites will follow in 2023. In Germany, the company’s facilities in Berlin, Hamburg, Oberwihl and Emmerich are among its CO2-neutral facilities. During 2022, Freudenberg increased its share of electricity from renewable sources from 21 to 30 percent of its total electric power consumption.
Freudenberg has been socially committed since its founding. With its “Education and Environment” program, its social involvement is being strengthened. The goal is to give people access to jobs and education while promoting environmental protection. Since the start of the program in 2015, the Freudenberg Group has provided €18 million to promote charitable projects and has funded 170 of them, including 40 in Europe.
Here’s one way the funds are being used: Many children in Vietnam live in harsh social and economic conditions. Abandoned by their families or orphaned, they are on their own. SOS Children's Villages in Vietnam cares for children in these situations. Last year, Klüber Lubrication employees in Vietnam supported the work of SOS Children's Villages in Ben Tre and Da Lat in South Vietnam.
We can expect economic and political uncertainties to continue. Challenges and risks are emerging, sometimes exacerbated by the war in Ukraine and the COVID 19 pandemic. They include the energy supply, raw material bottlenecks, price increases, suppliers' delivery problems, and labor shortages. To deal with these challenges, we will continue to be agile at each of our locations and respond quickly and flexibly to the constantly changing requirements – with an unflinching customer focus. This principle applies to every industry and region. We will meanwhile continue to invest in long-term projects. For us, the key strategic themes continue to be the transformation of mobility, digitalization and sustainable solutions.