Annual Report 2012 - Knorr-Bremse AG.

Management Report
15
creases and spending cuts. Full agreement on measures
to reduce the high level of national debt has yet to be
reached. In Brazil, the pace of economic growth slowed
once again, falling from 2.7% in 2011 to 1.0% in 2012.
Following strong performances in previous years, the
contributions made by China and India to global economic
growth fell in the year under review. In 2012, GDP
in China was up 7.8% (2011: 9.3%), while India saw GDP
rise by just 4.5% (2011: 7.9%) as weak domestic demand
and a low second-half investment rate took their toll. In
Japan, after natural disasters had shaped the previous
year, GDP recovered to show 2.0% growth (2011: -0.6%).
The uncertainty surrounding the development of the real
economy was also reflected in the commodity markets in
2012. Between January and April, the price of oil (Brent)
varied between USD 95 and USD 110 per barrel, before
falling to an annual low of USD 77 per barrel over the next
two months and rising back to USD 92 per barrel at yearend.
Aluminum prices followed a similar pattern and, after
rising to USD 2,350/t in the first quarter (top price in 2008
approx. USD 3,300/t, lowest price in 2009 approx. USD
1,300/t) declined again to USD 1,830/t in August, before
rising back to USD 2,100/t at year-end. On the balance
sheet date the value of the US dollar – which lines up
alongside the euro as one of the Group’s main operating
currencies – had risen 2.3% against the euro compared to
December 31, 2011, with one euro worth USD 1.32. As an
annual average, the euro traded at USD 1.29.
The business environment by sector
For the Rail Vehicle Systems division, the market environment
in 2012 was shaped by different developments in
rail transportation from one region to the next. In Europe,
demand for freight cars increased while locomotive output
stabilized and the passenger transportation sector
showed modest growth. In South America, demand for
freight cars rose in the first half of 2012, only to slip back
to a low level, while in North America it moved ahead by
around 25%. Orders on the books for locomotives, however,
which had been at a high level, declined on account
of excess capacity in the rail freight sector, lower freight
volumes and the uncertain economic backdrop. The passenger
transportation sector in the Americas showed
modest growth in the year under review. In Asia the volume
of rail freight remained unchanged, while demand
for locomotives and high-speed trains again showed a
slight fade. This contrasted with sharp growth in the metro
system market in China, which almost completely offset
the moderate downturns in the other sectors in the
Asian region.
After two years of growth, the commercial vehicle markets
showed an overall decline in 2012. Global truck production
(air-braked trucks of 6 t and over) fell by 14%. In
Europe, truck production was 11% down on the previous
year (2011: +31%). In North America there was to be no
repeat of the very strong prior-year growth. Nevertheless,
the market continued to expand, posting a 4%
growth in air-braked vehicles (2011: +54%). In South
America, truck output was 35% down in 2012 against the
backdrop of legislation introducing the Euro V exhaust
emissions standard, which had led to advance buying in
the previous year (2011: +14%). In the Asian region, the
negative growth trend triggered in the prior year picked
up speed in 2012 as truck production fell by 16% (2011:
-9%).