On October 26th, Bosch, the world's largest automotive parts supplier, announced that it would transfer its mobility business in Germany, along with Bosch's three service units - Digitalization, Global Business Services, and Global Real Estate - from Robert Bosch GmbH to independent legal entities, to operate as wholly-owned subsidiaries of the group. The group's headquarters would be transformed into a holding company, retaining only the functions of group financing and central research and early engineering. The new entities would commence operations on August 1, 2027, and the overall adjustment would be completed in phases by the end of 2027.

This adjustment involved approximately 62,500 employees in Germany, the vast majority of whom were from the mobility sector. These employees would transfer their labor contracts to the newly established subsidiaries of Bosch. After the adjustment, the Bosch headquarters would have only 3,000 employees left. Bosch emphasized that the newly split legal entities would still be 100% wholly-owned by the group and there were no plans to sell or split off the mobile mobility business.

According to informed sources, this adjustment is part of the group's unified structure in Germany and is not targeted at regions such as China. The business layout and investment in China are not affected. In the fiscal year 2025, Bosch's sales in China reached 149.8 billion yuan, an increase of 4.9%.

The object of Bosch's split this time is the group's most important business segment. In 2025, the revenue of the mobility business was 55.8 billion euros, accounting for approximately 60% of the group's total revenue of 91 billion euros. However, this segment is facing significant operational pressure. The operating profit margin in 2025 dropped from 3.8% in 2024 to 1.8%. The management estimated that there would be an annual cost gap of approximately 2.5 billion euros. One month before the announcement of the split, Bosch released its first half-year report, with the profit margin also dropping from 5.8% in the same period last year to 4.7%. In September last year, Bosch announced an additional layoff of about 13,000 people, adding to the approximately 9,000 people announced in 2024. The cumulative layoff scale by 2030 would be approximately 22,000 people, with most of them in the mobility business. In 2025, Bosch made a one-time provision of approximately 2.7 billion euros for restructuring reserves for this purpose.

Stian Fischer, the chairman of the Bosch board of directors, said that the company faces increasingly severe challenges in various markets, with new competitors from Asia intensifying the competitive pressure. Bosch needs to accelerate the introduction of innovations to the market and significantly simplify structures and processes. Markus Heyn, the vice chairman of Bosch responsible for the mobility business, said that the newly independent mobility segment would create new opportunities for strategic partnerships and new business models.

Bosch is not the first European traditional parts giant to make such a move, nor will it be the last. Over the past year, Continental Group, SKF of Sweden, ZF, Faurecia, Freivia, and Schaeffler, among others, have all undergone bold reforms. Continental Group split its automotive business into an independent listed company, Aumovio, in September 2025, which is listed on the Frankfurt market, covering automotive electronics, assisted driving, displays, and braking. The business remaining in the parent company is the tire business. SKF launched the split of its automotive business in September 2024, naming it SKF Vertevo, and is expected to be listed on Nasdaq Stockholm in December. ZF announced in December 2025 that it would sell its advanced driver assistance system business for 1.5 billion euros to Harman International, with the expected delivery in the second half of 2026.

From the existing split cases, the first annual report of the newly split Oumovio of Continental Group showed that in 2025, its net loss expanded from 289 million euros to 655 million euros. After excluding the one-time expenses from layoffs and the split, the adjusted earnings before interest and taxes were 717 million euros, an increase of 45.5%. However, in the first half of 2026, the adjusted EBIT (earnings before interest and taxes) of Omowei dropped from 260 million euros to 157 million euros, a decline of 39.8%, and the profit margin remained at only 1.8%. After ZF sold its ADAS (Advanced Driver Assistance Systems) for passenger vehicles to Harman, the adjusted EBIT margin for the first three quarters rose from 3.6% in the same period of the previous year to 4.9%. The adjusted free cash flow for the first half of the year was 989 million euros, doubling compared to the previous year.

Each company has its own approach, but the challenges they face are highly consistent. Chinese automakers can increase configurations in a few months and complete model updates in about a year, while traditional suppliers take three years to develop a solution that may be delivered when the customer has already changed chips and electronic architectures. To keep up with the pace of Chinese manufacturers, traditional supplier giants are all planning to streamline their operations. At the same time, several traditional automotive component giants are also looking for new bets outside of the automotive sector. Bosch has regarded humanoid robots as an additional growth engine beyond its automotive business; Schaeffler, on the other hand, has reversed its strategy, acquiring Vippe Technology and betting on robotics, defense, and aviation, with the goal of achieving a 10% share of such emerging businesses in the group's total revenue by 2035.

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