Annual Report 2012 - Knorr-Bremse AG.

Management Report
35
In the South American rail vehicle market, following the
sharp downturn in rail freight in 2012, demand for freight
cars and locomotives is expected to remain stagnant for
the next few years. The shelving of planned high-speed
routes in Argentina, Venezuela and Brazil puts back the
chances of growth in this sector by several years. In the
passenger transportation sector, several small and midsized
mass transit networks are being further expanded
in 2013, although not on the same scale as in 2012.
In the South American commercial vehicle sector, truck
output is expected to show a slight increase in 2013
compared to 2012. The introduction of legislation prescribing
ABS for commercial vehicles in Brazil will prove a
growth driver in the years ahead.
In the rail vehicle sector in the Asia/Australia region, the
outlook for 2013 and 2014 presents regional differences.
In China, the mass transit segment is expected to show
further modest growth. Developments in the highspeed,
intercity and freight transportation segments,
however, are marked by uncertainty owing to unclear
economic developments and the change of government.
Further growth is anticipated for the markets in
India and Southeast Asia, while the market situation in
Japan, Korea and Australia is expected to remain stable.
two years in a business environment still marked by uncertainty.
Regional developments will be influenced by
the risks for the continued growth of the global economy
described above, which differ from one region to the
next. Assuming that the economic picture does not deteriorate
any further, Knorr-Bremse expects earnings also
to remain stable. Based on the assumptions made for the
Group, the assets, financial status, and profitability of
Knorr-Bremse AG too can be expected to remain stable
– depending on the level of income from the company’s
investments.
In the coming years, Knorr-Bremse will continue to pursue
a policy geared to safeguarding the company‘s longterm
health and in particular will be driving forward the
steps already introduced to expand its capacities in regions
where demand is growing. These include, for example,
an intensive marketing effort in the BRIC countries
and the introduction of innovative products, as well
as the selective expansion of the company’s fields of activity.
The focus here will remain on boosting customer
benefits and securing the company’s technology leadership.
In the commercial vehicle sector, the region as a whole is
expected to show a moderate increase in truck production
in 2013 and 2014. In China, a moderate recovery is
anticipated for the next few years following the sharp
drop in truck output in 2012. The level of market activity
will, however, remain below the record production level
achieved on the back of state subsidies in 2010. The commercial
vehicle market in India will probably also stage a
recovery, while the Japanese market is expected to remain
stable.
Based on the regional backdrops set out above, Knorr-
Bremse expects to see sales remain stable over the next