DEKRA invests in secure digitalisation

 

Expert organisation calls for stronger regulation and independent oversight

• Fatalities in connection with autonomous driving are a cause for concern
• Cyber risks require a rethink
• DEKRA establishes global testing network for safe mobility
• Record investment of 150 million euros with focus on digitalisation
• Sales increase by 8% to over 3.1 billion euros in 2017
• Workforce increases by 4,700 to over 44,000 employees

According to DEKRA, cybersecurity and mature technical safety standards are becoming critical success factors, particularly in connection with connected and automated driving. ‘People are increasingly willing to hand over control and responsibility to technology due to the many advantages,’ said Stefan Kölbl, Chairman of the DEKRA Board of Management, to journalists in Stuttgart. ‘However, this is only acceptable if both our health and our data are protected - and this is not always the case today.’ With this in mind, the global expert organisation has expanded its position as a ‘Digital Safety Expert’. In 2017, a significant portion of the 150 million euro investment was channelled into strengthening digital testing expertise, contributing to the 14th consecutive year of growth. Group sales rose by a robust 8.0% to more than 3.1 billion euros, while adjusted EBIT increased by 15.5 million euros to 236.1 million euros. The number of employees exceeded the 40,000 mark for the first time, growing significantly by 4,700 to a total of 44,057. As the largest non-listed company in the TIC (Testing, Inspection, Certification) sector, DEKRA has more than doubled its turnover and number of employees in the last ten years - with an increase in turnover of almost 1.7 billion euros and over 25,000 employees.

Whether in the areas of automated mobility, smart home, Industry 4.0 or modern working environments - the benefits of digital transformation are undeniable. However, security standards have not kept pace with the rapid development. Data breaches, hacking incidents, fatal accidents involving autonomous vehicles, bugging scandals in children's bedrooms and malfunctioning robots are increasingly making the headlines. "We need a clear global legal framework and mature, validated technologies. Otherwise, we will not only jeopardise the privacy of individuals, but also their lives," says Kölbl.

In order to protect human lives, DEKRA is in favour of new security standards for all internet-enabled products that take account of increasing networking and growing cyber threats. The organisation therefore supports the Cybersecurity Act proposed by the European Commission. According to DEKRA, authorised access to data generated by networked and increasingly automated vehicles is just as important. ‘Only with access to such data can expert organisations such as DEKRA fulfil their safety mandate as independent third parties in the digital age,’ emphasised Kölbl. "We welcome the future EU regulation on type approval, which obliges car manufacturers to provide safety and environmental data for periodic monitoring. Ongoing random checks of new vehicles that have already been authorised will further improve consumer protection. Both measures are important steps in the right direction."

International test network for the safe mobility of the future

The safety of mobility has been a core task since DEKRA was founded almost 100 years ago. For this reason, the focus last year was on establishing an international testing network for the mobility of the future. This includes competence centres in Klettwitz (Germany), Málaga (Spain) and Hsinchu (Taiwan). One strategic step in this initiative was the acquisition of the Lausitzring near the DEKRA Technology Centre in Klettwitz. ‘With the Lausitzring, we now operate Europe's largest independent test track for automated and connected driving,’ says Kölbl. "Automation and connectivity are becoming increasingly important for safe mobility. In Klettwitz and Málaga, we offer our customers from the automotive industry a comprehensive range of testing and development services for the autonomous and connected mobility of the future." One example is the eCall emergency call system: DEKRA carries out crash tests and type approvals in Klettwitz, while Málaga specialises in testing safe and reliable communication and electromagnetic compatibility (EMC).

The newly opened test site in Málaga (November 2017) focuses on early-stage product testing and the evaluation of vehicle-to-everything (V2X) technologies, including the associated standardisation requirements. DEKRA's largest laboratory for autonomous and electric mobility services has been located in Hsinchu since the beginning of 2017. It plays a key role in the expansion of DEKRA's automotive testing market in Asia.

 

Further expansion of digital inspection services

In view of the growing global importance of connectivity and cyber security, DEKRA has strengthened its position through acquisitions and partnerships - including the takeover of the Spanish company Epoche & Espri, which evaluates and tests products according to internationally recognised IT security standards. Its customers include developers, manufacturers and service providers. With the integration of Epoche & Espri, DEKRA has expanded its services in sectors such as consumer goods, medical technology and the automotive industry. Cybersecurity is already a core component of DEKRA Smart Product Tests. The acquisition enables the company to fulfil the extended testing and certification requirements for functional safety.

DEKRA's digital strategy also includes investments in innovative companies and start-ups, such as the Stuttgart-based consultancy Magility, which supports customers in the development of digital products, processes and business models. In addition, DEKRA founded DEKRA Digital GmbH at the beginning of 2018 to accelerate the digital transformation.

DEKRA Automotive: Market leadership strengthened

DEKRA Automotive made a significant contribution to the Group's overall success in 2017, increasing sales by 3.8% to just under € 1.6 billion. This includes € 169 million from industrial testing services provided in Germany by DEKRA Automobil GmbH - a segment that recorded a 13% increase in demand despite a highly competitive market environment, particularly in the testing of lifts and pressure vessels. Within three years, turnover in this segment has risen by 49 million euros - an increase of over 40 per cent. Overall, the turnover of DEKRA Automobil GmbH rose by 5.5% to 1.2 billion euros in 2017. By expanding its network of test centres and optimising processes, the company has further strengthened its core business of vehicle testing and assessment. With around 11 million inspections per year and a market share of 34% for general inspections, DEKRA remains the number one testing organisation in Germany.

With around 26 million vehicle inspections per year, DEKRA is also the global market leader. Building on this strong position, the company pushed ahead with its international expansion in 2017. After entering the Portuguese market in 2016, DEKRA significantly expanded its testing network there with the acquisition of MasterTest - with 14 stations, DEKRA is now one of the three largest providers in Portugal. DEKRA's automotive services business also developed positively in markets such as France, Sweden, South Africa, New Zealand, the Czech Republic and Slovakia. At the end of 2017, the company entered the market for vehicle inspections in Luxembourg. DEKRA is also expanding in the USA: in April 2018, DEKRA acquired the emissions testing company Jiffy Smog, which operates 24 stations in and around Las Vegas, Nevada.

DEKRA Industrial: Success in established and emerging markets

In 2017, DEKRA Industrial further strengthened its presence in future-oriented sectors, supported by strategic investments and a clear focus. Sales increased by 5.3% to almost 900 million euros, of which 169 million euros came from industrial services provided by DEKRA Automobil GmbH in Germany. ‘The year was characterised by strong organic growth and strategic acquisitions in both established and emerging markets,’ said Stefan Kölbl.

In the electricity and energy sector, DEKRA has taken over the VEIKI-VNL high-voltage testing laboratory in Budapest, Hungary, which tests and certifies systems for electricity transmission and distribution. Its customers include major manufacturers in 40 countries worldwide. ‘VEIKI-VNL's capabilities and services are a perfect fit for DEKRA and significantly strengthen our position in the energy sector,’ says Kölbl. With the acquisition of Core Visual Inspection Services in Charlotte, North Carolina, DEKRA has also entered the US power plant inspection market - a strategic move in line with the company's vision to build a strong presence in the growth markets of North America and Asia-Pacific. In 2017, DEKRA intensified its innovation partnership with the Fraunhofer Institutes IAO and IPA to develop advanced occupational safety concepts in the age of Industry 4.0. A demonstration with a band saw equipped with intelligent sensors showed how accidents at work can be avoided. ‘We want to use digitalisation to sustainably improve proactive safety at the human-machine interface,’ said the DEKRA Chief.

DEKRA Insight, the consulting division, improves the safety of its customers through innovative methods based on the latest findings in neuroscience. One example is the Brain-Centric Reliability System, which makes use of how the human brain processes information to promote safe behaviour and awareness among employees and ultimately reduce accidents at work.

DEKRA Personnel: Strong growth momentum

DEKRA Personnel's strong market position and the stable economy in Germany and large parts of Europe were reflected in an increase in turnover of 24.8 per cent to 650 million euros in 2017. DEKRA Arbeit in particular was able to grow significantly, consolidate its position as the seventh-largest personnel service provider in Germany and successfully expand internationally. Around 12 million euros of the increase in turnover was attributable to DEKRA Akademie - one of the largest private training providers in Germany with over 150,000 participants each year.

The DEKRA Safety Web digital training platform has also continued to grow strongly due to strong demand, particularly for driver safety training for different vehicle classes in the professional environment.

In view of the increasing shortage of skilled workers, the ‘Expert Migration’ programme offered by the DEKRA Academy is very popular. As part of this initiative, skilled workers - primarily in the healthcare sector and increasingly also in the IT sector - are given professional and language qualifications in their Eastern European home countries and then placed in jobs in Germany. Over 2,500 participants are currently enrolled in the programme. In 2017, more than 1,000 qualified nurses started work in Germany, with around 1,500 per year expected from 2018 onwards. ‘DEKRA is the only training provider to offer complete professional and language training with a state-recognised qualification in Germany,’ says Kölbl.

In addition to Germany, DEKRA Arbeit is successfully active in 14 other European countries. Bulgaria was added in 2017, with Austria and France to follow in 2018. As a premium provider, DEKRA Arbeit employed over 17,000 temporary workers at its peak in 2017.

Positive outlook for 2018: DEKRA wants to help shape the digital transformation

DEKRA worked intensively on expanding its strong competitive position in 2017 and will continue its dynamic growth trajectory. The company is expecting another positive business performance in 2018 - and thus the 15th year in a row. ‘DEKRA is actively shaping the digital transformation of the economy and society at the crucial interface to security,’ says Kölbl. ‘With innovative testing and certification services, we are helping to define the necessary testing standards and ensure security in the digital world.’

About DEKRA

DEKRA has been committed to safety for more than 90 years. Founded in 1925 in Berlin as Deutscher Kraftfahrzeug-Überwachungs-Verein e.V., it has developed into one of the world's leading expert organisations. DEKRA SE is a wholly owned subsidiary of DEKRA e.V. and manages the Group's business. In 2017, DEKRA generated a turnover of more than 3.1 billion euros and employed over 44,000 people in more than 50 countries on five continents. With qualified and independent expert services, DEKRA promotes safety on the road, at work and at home. The service portfolio ranges from vehicle inspections and appraisals, claims management, industrial and construction inspections, safety consulting, product and system testing and certification to training and temporary employment. DEKRA's vision for its 100th anniversary in 2025: to be the global partner for a safe world.