The European Investment Bank (EIB) is providing a promotional loan of €425 million (Rs 3,735 crore) to German automotive supplier ZF Friedrichshafen AG. The funds will enable ZF to invest a total of €1.3 billion (Rs 11,424 crore) in research and development of innovative technologies for braking and steering systems, actively shaping the switch to software-defined vehicles.
With such new technologies, ZF will be able to remain competitive as the mobility sector moves towards highly automated driving. The company is already pioneering the development and industrialisation of modern chassis systems.
The loan will help to finance the development of x-by-wire technology, including the steer-by-wire system, which does away with the mechanical connection between the steering wheel and steering system. These technologies are fundamental for higher levels of vehicle automation. They lead to better vehicle control, more steering flexibility, greater driving stability at high speeds and, by extension, an overall increase in safety and comfort.
Alongside hardware components, software also plays a central role in this innovation project. The initiative follows a clear trend in the automotive industry away from the many individual controls of hardware components and towards overarching domain and zone architectures. New electric and electronic vehicle architectures bundle all the software for a specific functional area of a car in a central control unit. This is an important step on the road to autonomous driving.
As a result, the project will contribute to more efficient and sustainable mobility in Europe. About 30% of the planned investments will be made in EU cohesion regions such as Poland, Romania and the Czech Republic. The investment will safeguard and create jobs as well as train people in new skills, especially software.
Third joint EIB-ZF project
The transaction marks the third project between the EIB and ZF. They joined forces in 2016 to increase the efficiency of combustion engines and in 2021 to accelerate innovation in the field of autonomous driving.
“This project is an excellent example of how the EIB supports the innovation capacity of the European transport and automotive industry,” says EIB Vice-President Nicola Beer. “Technological leadership in the field of highly innovative braking and steering systems is of great importance to strengthen the competitiveness of the European industry and to secure jobs along the entire value chain. This transaction underlines the successful strategic cooperation with ZF, a supplier with high innovative strength in this future area.”
“We are pleased to continue our longstanding partnership with the EIB,” said ZF Management Board member Michael Frick, who is responsible for IT, equity investments and passive safety technology as well as finance in the ZF Group. “The EIB stands for long-term financing and is recognised as a sustainable investor. That suits us well as a company with two foundations as shareholders.”