Weak Sales Spur Cost Cutting at Bosch

Robert Bosch GmbH says it will reduce costs and curtail capital spending this year because the company missed its 2012 sales target by €600 million. Only automotive R&D will be exempt.

Revenue grew 2% to €52.3 billion last year, but the increase came from favorable exchange rates. Operating return on sales was about 2% in 2012 compared with Bosch's long-term goal of an 8% average.

The company's auto unit boosted revenue 2% to a record €30.9 billion last year well short of the €31.5 billion forecast last autumn.

Group sales fell 2% to €29.7 billion in Europe and climbed 9% to €10 billion in the Americas and 5% to €12.6 billion in Asia Pacific. The company predicts global revenue will rise 3%-5% this year.

Bosch is scheduled to report detailed 2012 results, including earnings, in April.