ABB wants to focus its portfolio on digital industries. This is to be achieved through the sale of the Power Grids division, the simplification of the business model and corporate structure following the dissolution of the previous matrix structure and the creation of four business units.

The four new divisions are Electrification, Industrial Automation, Drive Technology and Robotics & Factory Automation. ABB's reporting will be in line with the new corporate structure from April 1, 2019. The new ABB will have total annual sales of USD 29 billion and employ around 110,000 people.

Electrification

According to ABB, the Electrification division is currently number two on the global market and offers a portfolio with a complete range from the source to the socket. The division has 55,000 employees and is headed by Tarak Mehta. The division expects above-market growth due to the combined effect of several factors. These factors include geographic growth in the US and China, a focus on higher-growth segments such as data centers, smart buildings and e-mobility services, and portfolio benefits from modular, scalable and preconfigured solutions. With electrification, ABB generated sales of around USD 13 billion and an operating EBITA margin of around 13% in the 2018 financial year. The medium-term target corridor for the operating EBITA margin is 15% to 19%.

Industrial automation

According to ABB, the newly formed Industrial Automation division (excluding B&R) is the number two in the global market. Its focus is on shaping the future of safe and smart production. The Industrial Automation business unit will serve customer needs with a unique portfolio of integrated solutions, including DCS (Distributed Control Systems).

The focus of the offering is on integrated automation solutions in the areas of process, electrical and drive technology, measurement & analysis as well as marine and fast charging solutions for customers in the oil and gas, chemical, pulp and paper, marine and port industries. The division has 21,000 employees and is headed by Peter Terwiesch. The division is expected to achieve above-average growth figures through industry-specific, differentiated automation solutions in the areas of process, electrical and drive technology, building on ABB's leading process control systems (DCS) offering and comprehensive range of products, as well as customized growth initiatives for key industries.

Industrial Automation achieved sales of around USD 6.5 billion and an operating EBITA margin of around 14% in the 2018 financial year. The medium-term target corridor for the operating EBITA margin is 12% to 16%.

The drive technology

According to ABB, the newly created Drive Technology division is the world's number one in drive technology and focuses on electromobility and its associated benefits. ABB expects the total number of electric motors to double by 2040. This is equivalent to the annual energy consumption of the whole of China. The Drive Technology division offers a comprehensive range of electric motors, drives and services. The division has around 20,000 employees and is headed by Morten Wierod, who was appointed to the Group Executive Board on April 1, 2019. Growth will be achieved through targeted geographic initiatives, a segment-specific portfolio and the use of ABB Ability services to secure the future of smart drives. ABB generated sales of around USD 6.5 billion and an operating EBITA margin of around 16% with Drive Technology in the 2018 financial year. The medium-term target corridor for the operating EBITA margin is 14 % to 18 %.

Robotics & production automation

The Robotics & Factory Automation division will combine ABB's machine and factory automation business (mainly B&R) with the Group's robotics platform. It will harness the opportunities of the "factory of the future" and shape the future of flexible manufacturing and intelligent machines. The division combines the offering for flexible automation, which includes control, motion, robotics, software and services, and offers integrated solutions from the machine to the factory. According to ABB, the division is the world's number two in terms of size and number one in terms of growth. The division has 11,000 employees and is headed by Sami Atiya. In particular, "by combining B&R's machine and factory automation business with our robotics solutions, we are providing strong momentum for a unique and comprehensive offering that will help our customers create the flexible factory of the future," says Sami Atiya, President of the Robotics & Factory Automation business unit.

ABB achieved sales of around USD 3.6 billion and an operating EBITA margin of around 15% with Robotics & Factory Automation in the 2018 financial year. The medium-term target corridor for the operating EBITA margin is 13% to 17%.