Gérald Streit

Chairman & CEO (Président-Directeur Général), Delfingen Industry S.A.

[RETAIL DAY] Interview with Gérald Streit, CEO of DELFINGEN

🎥 Oct 09, 2024 📺 Bourse Direct ⏱ 14m 👁 782 views

Gérald Streit, CEO of DELFINGEN, is interviewed by Marc Fiorentino, President of Euroland Corporate. "Retail Day: Discovering the Hidden Gems of Small & Mid-Cap Companies" is back! An Euroland Corporate event in partnership with Bourse Direct. Exclusively, seven business leaders will be interviewed by Marc Fiorentino, President of Euroland Corporate, and will answer your questions. They will share their vision and analysis of the current market. Don't miss any of our videos by subscribing to our channel: / @boursedirect Join us: Instagram: / boursedirect.fr LinkedIn: / bourse-d...

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About Gérald Streit

Gérald Streit, chairman and CEO of Delfingen Industry, discussed the company's strategy and performance in several interviews during 2024 and 2025. He stated that Delfingen had grown significantly in recent years, nearly tripling revenue over four years, partly by acquiring its main German competitor to become the world leader in its segment. Streit said the company would focus on debt reduction and cash generation through 2026 before resuming external growth, particularly in industrial markets. He also noted that no single client represents more than 8% of revenue, which he described as providing the company with independence. Speaking about the automotive sector, Streit described it as a "structured" industry where not all participants will succeed. He gave the example of Geely's approach to hybrid and electric vehicles as having "a certain vision," contrasting it with other automakers he characterized as appearing "lost." Streit also discussed Delfingen's environmental initiatives, stating that as a company that has been transforming plastic for 70 years it has a responsibility to address plastic pollution. He noted the company had committed to reducing CO₂ emissions under the COP21 framework and said it had begun measuring its emissions and plastic consumption. Streit described a partnership with Plastic Odyssey to develop small-scale recycling micro-factories, calling the effort part of a "beginning of an amazing journey."

Source: AI-verified profile updated from Gérald Streit's recent appearances. Browse all interviews →

Transcript (37 segments)

Interviewer0:07

And we continue with our interviews as part of our second Retail Day, following the enormous success of the first one, in partnership with Bourse Direct. I'm really happy to have you today because we hear and read so many things about the automotive sector. Frankly, I really struggle—I'll say it totally honestly—to make sense of it all. So I need your insights. You're going to tell us about Delfingen. Gérald Streit, you're the Chairman and CEO of Delfingen. First of all, thank you for coming. It's always a pleasure to have you. Every time—I've told you this off the record—every time we meet, fortunately I get to see you because you give me a bit of a vision of the sector. And it's true that right now it feels like nobody understands the automotive world anymore—not the buyers, not the analysts, not the investors, and the media I won't even mention. So what's happening in the automotive sector? Can you walk us through—even before we talk about the company, you're here for that too—but you're in this sector that you know inside out, a sector your family has been invested in for years. What's really going on? Is there a clear direction or not?

Gérald Streit1:27

So there is a clear direction, there are things happening. If I go back a few years to trace the trend, we were in a very incremental technological phase with cars. Brands competed on engine displacement, on reputation, those kinds of things. Then came China's development, which set the goal of being the world leader in electric vehicles—which made everyone laugh back in the early 2000s, 2010. Except they actually did it. They went electric to capture that technological gain and leapfrog thermal vehicles. The major manufacturers, especially the Germans who were in China, along with the Americans, drew enormous profit from their joint ventures, thinking they'd keep selling thermal vehicles and so on. They didn't see the wave coming, even though it was announced. The wave arrived in Europe—there's an acceleration of electric vehicles when the manufacturers, after the 2019 COVID crisis, realized that the Chinese were doing exactly what they'd said: expelling China, as we might call it, and replacing their thermal vehicles with Chinese electric vehicles. So it's full reverse, because when you derive 30 or 40 percent of your revenue from a market that no longer wants you, you need to reinforce on your domestic market. So in Europe, we have good news—we're going fully electric. Then they realize that even with this trend, they're being pushed out of China, and that's what's happening now. So they're in complete doubt. I think that in any case, the evolution is toward electric vehicles.

Interviewer3:01

So you're saying the direction is clear—stop hesitating, we're heading toward electric. You gave me a really good comparison earlier, I'd like you to take that up.

Gérald Streit3:12

Yes, we're heading toward electric vehicles. It's like digital photography versus film photography. There's a phase of doubt, but we're going there. We're in an industry based on mobility with a price-volume ratio. Thermal vehicles have more components than electric vehicles—they are de facto more expensive to build, more complicated to build than an electric vehicle. So we're heading toward electric vehicles. Simply put, we're on the BCG experience curves, and they're crossing massively. The electric vehicle will be more competitive, easier to make, less expensive to maintain. So it will arrive.

Interviewer3:55

Okay, but I like the analogy you drew from film to digital. But from film to digital, there were companies that disappeared. We remember the one from my youth—Kodak—nobody knows it anymore. So what does that mean? There will be manufacturers who disappear? And does it mean—as you explained well that China has taken an enormous lead—is the deal done? Are they going to crush us?

Gérald Streit4:19

Well, the deal is never done. But the longer you wait, the harder it gets. I think it will really depend on the manufacturers. Some will certainly disappear, just like suppliers. The speed—you can't reposition at such a fast pace. We were talking a few years ago about an automotive revolution. A revolution means it moves very, very fast. All the time lost is very, very hard to recover. And a revolution also means heads will roll. So yes, there will be disappearances. There will be disappearances.

Interviewer4:53

Do we still have a chance in Europe to compete with China? Or do you think if we react quickly, we can still do it?

Gérald Streit5:03

I think we can react quickly, and we must. I just came back from Asia. When you see the pressure that Korea and Japan are under—they're in an ultra-competitive environment. They're looking for alternative solutions because the volume is in China on their domestic market. So we start from the basics: what is our domestic market, what are our directives, and what are Korea and Japan doing? Korea is working on competitiveness and pivoting toward electric. They're restructuring their big conglomerates with battery manufacturers—Hyundai, Kia—and also everything related to software, because it's a package deal. The Japanese, as we've seen with Toyota, are trying alternative paths. This is my interpretation: on electric, they believe they're going to lose ground, so let's take a further step with biofuels, renewable fuels, even hydrogen, or flex-fuel hydrogen.

Interviewer6:05

You're saying they're going to look for an entirely different market.

Gérald Streit6:08

They can look for another market. That's what we learn in business school—when everyone heads to one market, try to find differentiated paths. That's what's interesting.

Interviewer6:15

Coming back to Delfingen—thank you, this is very important.

Gérald Streit6:19

No, no, it's very important because it's your market too.

Interviewer6:22

So how does this environment help you or affect you?

Gérald Streit6:26

For 70 years, we've been making components to protect electrical wires—mainly in automotive, and we're diversifying into other equipment sectors. We are very impacted by automotive, but with a certain distance, because regardless of the automotive equipment, you need electrical wire. So we're going to protect it. That's what gives us a bit more breathing room. And we've been in this business for 70 years.

Interviewer7:00

So just now, there were quite a few questions on exactly this topic. With the acceleration of vehicle electrification—I'll read you the question: How does Delfingen plan to adapt to these transformations, and what opportunities do you see in the development of electric and hybrid powertrains? It's your market.

Gérald Streit7:17

So hybrid powertrains—we have both elements, since we have thermal with all the sensors, and we have electric. So hybrid is great for us, except it's very costly to make and doesn't answer all the questions. With electric, we see technological changes coming—approaches that are completely different. We have the same paradigms, just one simple thing: in a classic vehicle, there's a small battery in the front or back, and then wires run from there. In an electric vehicle, there's a large battery, so you can connect wherever you want on the battery. Big change. Our products work on both technologies. The question is the evolution of the product mix and volumes.

Interviewer7:55

And today, can you just give us a quick update on the first half?

Gérald Streit8:00

The first half—we experienced a revenue decline tied to two major factors. The first is a European slump with a lot of hesitation, linked to doubts about electric vehicles. In the United States, some platforms—notably Stellantis—didn't launch on time as planned, which impacted us strongly. And we continue our rationalization and refocusing phase following our growth period over the last three years.

Interviewer8:30

So what are the prospects? I'm not asking for figures because you know how it is, but what are the growth factors for you in the months and years ahead? Is it a matter of hunkering down and waiting, as you somewhat said, for the storm to pass and for the direction to become clear? For you, the direction is clear—and thank you for that—so what's the strategy while waiting?

Gérald Streit8:56

No, no, we're moving forward. We had strong growth and consolidated market share on the automotive side, which gives us leverage on pricing. We've committed for several years to qualitative growth—meaning price, margin, lever capacity. The second is our environmental and societal commitments. We mustn't forget that the major challenge for our societies is climate change, pollution—even though we're busy with very short-term performance issues. So we're well-oriented on that. On the automotive side, it's a rationalization of the portfolio and product lines. The matrix has to pay, so we're in this cleanup phase to diversify into other sectors that are less cyclical than automotive—industrial and agricultural sectors.

Interviewer9:48

So we're told that Delfingen's market share in industry is growing. Which industrial sector outside of automotive presents the greatest opportunities for you?

Gérald Streit9:58

With 8 or even 10 billion people on the planet, agricultural equipment—automation of agricultural machinery—for me that's a major development axis.

Interviewer10:09

And you're moving into that?

Gérald Streit10:11

We're already a supplier of Tier 1 suppliers to the agricultural industry, and we want to strengthen on those elements.

Interviewer10:24

All right, let's finish with that—thank you, this was very clear. Let's finish on the stock market. You've always had a strategy—and your father before you—of transparency and communication with individual shareholders, which is why we're here. You're going to go even further in that direction. Will you maintain that policy? And regarding individual shareholders, we have shareholders who come back to every annual general meeting, and some have been there since the IPO.

Gérald Streit10:45

We have individual shareholders who come back to every annual general meeting, and for some of them, they've been there since the IPO. There's a farmer from a village who wouldn't miss it for the world—he's there at every annual meeting since '96. We see that their approach is less about monetary value and more about how we do business. They invest in the company and stay because they love it—they love our long-term approach to business.

Interviewer11:16

You can—I don't know if you'd call them investors—but there's a real patrimonial approach, saying 'I own shares but I don't want to sell.' They're like partners, essentially—non-operational partners.

Gérald Streit11:27

They're non-operational partners. And they ask us questions—mainly ethical questions, questions about CSR, our environmental commitments. So we have both types of investors.

Interviewer11:39

So you continue with this whole policy of closeness, transparency, and communication with individual shareholders.

Gérald Streit11:48

We don't change our culture. We've always had this policy of transparency and engagement on environmental and societal issues.

Interviewer11:56

And it's remarkable because you do it even in difficult periods. I congratulate you—in difficult periods you say exactly what the situation is. Finally, do you feel that the market today understands your business and values it as it should? I'm sure you're going to tell me no—they're lost.

Gérald Streit12:15

Well, no, they're lost. If the automotive buyer is lost, the investor is lost too.

Interviewer12:20

What would you like to say to this investor who is lost, facing a valuation that has so much hidden potential at some point?

Gérald Streit12:32

You have to look at the verticals of the business. We're in automotive, which is a form of mobility, and different players intervene. It's an ultra-structured supply chain, but not everyone will make it. Some will make it, some will make it well. So you have to stop skimming over the file—you need to take the time to analyze the verticals and have other sources of information than the few gurus they put in front of us with their ideas.

Interviewer13:02

Try to find some visionary automotive executives. Give us a name of a visionary automotive leader.

Gérald Streit13:06

Well, the boss of Geely, the owner of Volvo. When he took over Volvo, the approach at the time was diesel, gasoline. He said, 'I don't have the money to do everything—I'll create a brand for electric.' I think there's a certain vision in what he does. The BMW family has a certain day-to-day vision. And then there are others—it feels like they're lost. They managed, which is what was asked of them, but now if you need to bring in a new policy, a real product strategy, a new energy—they're searching. They're searching, and they bring in consultants. And consultants, they're managers—they're not going to give you vision.

Interviewer13:53

Gérald, thank you very much. In any case, you've given us a good vision. We hope the share price bounces back and that what you've described unfolds. You'll come back and we'll do updates regularly. In case I was wrong, we'll see that you were right. Keep it up. In any case, you've helped us see through the fog a bit. We'll be right back for another interview.