German Auto Supplier Under Pressure: Schaeffler Reports Revenue Decline and Weak China Business
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Key Takeaways
- Schaeffler reported a revenue decline of 2.7 percent to 5.764 billion euros in the first quarter of 2026, with net earnings falling from 83 to 60 million euros
- The China business declined in the first three months of 2026, while only the e-mobility division grew by 3.7 percent to 1.210 billion euros
- On 18 June 2026, Schaeffler shares fell almost 10 percent following the BMW profit warning – significantly steeper than BMW's own decline
- Chief Executive Klaus Rosenfeld expects three-digit million euro orders from the humanoid robotics business by 2030
- Continental announced the elimination of 580 jobs at Contitech and several plant closures at the end of July 2026
Automotive supplier Schaeffler recorded revenue of 5.764 billion euros in the first quarter of 2026 (January to March) – a decline of 2.7 percent compared to the same quarter of the previous year. On a currency-adjusted basis, a strong euro resulted in growth of 1.0 percent. The EBIT margin before special items stood at 5.0 percent, with earnings before interest and taxes totalling 270 million euros. Net earnings came to 60 million euros, compared to 83 million euros in the same quarter of the previous year.
China Business Declining
The China business performed weakly. In the first three months of 2026, revenue in China declined slightly compared to the same quarter of the previous year. This contrasted with growth in other Asian markets outside China. The weakness in the world's largest automotive market is burdening the supplier, which has been struggling with a heavy debt load since a failed Continental acquisition.
E-Mobility as the Only Growth Driver
Of the four business divisions, only e-mobility grew. E-mobility revenues rose from 1.167 billion euros in the same quarter of the previous year to 1.210 billion euros – an increase of 3.7 percent, or 6 percent on a currency-adjusted basis. The other divisions reported revenue declines.
Chief Executive Officer Klaus Rosenfeld stated on 5 May 2026 that there were first signs of a rethink regarding the shift to e-mobility, \"even in a major market like America\" – driven by rising oil prices. Commenting on Q1 results, he said: \"There is no cause for celebration\", but saw his cost-cutting course confirmed.
Cost Optimisation and Energy Price Risks
Rosenfeld stressed that cost-saving measures from previous months were bearing fruit: \"All of our major plants have taken measures to optimise costs.\" The energy costs that had risen as a result of the Iran war had been \"buffered\" for 2026. Regarding 2027, the chief executive expressed caution: \"We need to see what happens in 2027.\"
High Dependence on Automakers Weighs on Stock Price
On 18 June 2026, the Schaeffler share price plummeted almost 10 percent. This was significantly more severe than the market's reaction to the BMW profit warning itself – evidence of the supplier's high dependence on the profitability of original equipment manufacturers. Schaeffler itself had not issued a new negative outlook operationally; the share losses were triggered by external warnings from automakers.
New Business Areas: Robotics and Defence
New business areas showed positive development. In humanoid robots, there were already 30 prototypes and five concrete customer contacts. Rosenfeld expected orders worth a three-digit million amount from this area by 2030.
Industry-Wide Job Cuts at Suppliers
Parallel to Schaeffler's challenges, automotive suppliers are cutting tens of thousands of jobs industry-wide due to high costs. Continental announced at the end of July 2026, for example, the reduction of 580 jobs at Contitech and several plant closures. The structural challenges posed by the shift to e-mobility and high energy and labour costs are burdening the entire industry.