Impact Analysis of ZF's €1.5 Billion Sale of ADAS Business to Harman International

1. Transaction Overview
   : The ADAS business sold by ZF covers computing solutions, smart cameras, radar technologies, and ADAS software functions, but retains chassis electronic components, passive safety technologies, and ADAS/autonomous driving businesses in the commercial vehicle sector [1][2][3]. Approximately 3750 ZF employees will transfer to Harman, and the transaction is expected to close in the second half of 2026, subject to necessary regulatory approvals [1][2][3].

2. Impact on ZF
   : ZF’s 2024 sales were €41.4 billion, and the transaction amount accounts for approximately 3.6% of its annual sales [2]. The deal will help ZF reduce debt and focus on core technologies (chassis, commercial vehicles, industrial applications) [1][3], optimizing its business structure.

3. Impact on Harman
   : As a subsidiary of Samsung Electronics, Harman will integrate ZF’s ADAS capabilities into its central computing and digital cockpit roadmap, enhancing its competitiveness in the software-defined vehicle (SDV) market [1][2]. This enables Harman to compete more directly with ADAS leaders such as Mobileye, Bosch, Continental, and Aptiv [1].

4. Market Background
   : The ADAS market is growing rapidly; according to forecasts, the global autonomous vehicle market will reach $597.7 billion by 2035, with a compound annual growth rate (CAGR) of 22.5% from 2025 to 2035 [4]. Samsung Electronics’ OTCQX stock (SSNLF) closed stably at $65.21 on December 22-23, 2025 (before and after the transaction announcement), with low trading volume, indicating a neutral market reaction [0].

1. Industry Integration Trend
   : This transaction reflects strategic integration in the automotive industry amid the transition to software-defined vehicles, where enterprises focus on core businesses or expand key capabilities through divestment or acquisition [1][3].
2. Harman’s Competitiveness Enhancement
   : Harman will offer more complete SDV solutions by integrating ZF’s ADAS hardware (cameras, radar) and its own central computing and digital cockpit software capabilities, becoming a more competitive participant in the ADAS field [1][2].
3. ZF’s Strategic Focus
   : ZF retains the commercial vehicle ADAS/autonomous driving business, indicating its strategic shift to this potential area, which may enable more focused technological R&D and market expansion.

1. Risks
   :
   • Regulatory approval uncertainty: The transaction is subject to necessary regulatory approvals, and the approval timeline and outcome are uncertain [1][3].
   • Integration risk: Harman’s ability and effectiveness in integrating ZF’s ADAS business remain to be observed [1][3].

2. Opportunities
   :
   • ZF can invest the proceeds from the transaction into core technology R&D to strengthen its competitive advantages in chassis, commercial vehicles, and other areas [1][3].
   • Harman can provide more comprehensive SDV solutions through integration to capture market share [1][2].

This transaction is a significant integration event in the ADAS sector of the automotive industry, reflecting strategic adjustments by enterprises to adapt to the software-defined vehicle trend. For ZF, it facilitates financial optimization and core business focus; for Harman, it is a key layout to enhance competitiveness in the SDV market. The market currently holds a neutral attitude towards the transaction, and we need to wait for the completion of the deal and the emergence of integration effects.