Knorr-Bremse Targets €10B Revenue, 16% Margin in Growth Beyond Push

Key Points

• Knorr-Bremse’s Growth Beyond strategy shifts focus from restructuring to margin-accretive expansion in rail signaling, energy technologies, aftermarket services and digitalization, while preserving efficiency gains from its BOOST program.
• The company is targeting €10 billion in organic revenue and a 16% operating EBIT margin by 2030, alongside free cash flow above €1 billion, cash conversion above 90% and return on capital employed above 25%.
• Rail remains the more profitable segment, while aftermarket operations contribute over 45% of revenue and provide resilient, higher-margin lifecycle sales. Knorr-Bremse also sees upside from predictive maintenance, autonomous-truck systems, electrification and expanded signaling markets.

Knorr-Bremse ETR: KBX outlined plans to expand revenue, margins and cash generation through 2030 as it shifts from a restructuring-focused program to a new growth strategy centered on rail signaling, energy technologies, aftermarket services and digitalization.

Speaking at an investor event, Sophia Kursawe, Senior Manager of Investor Relations at Knorr-Bremse, said the Munich-based supplier has been developing safety-critical systems for rail vehicles and commercial trucks for more than 120 years. The company is a global market leader in braking systems for both trains and trucks, while its product portfolio also includes couplers, entrance systems, sanitary systems, steering systems, engine components and air-supply technologies.

Knorr-Bremse reported 2025 revenue of €7.8 billion and operating EBIT of about €1 billion, representing a 13% operating EBIT margin, according to Kursawe. The company employs approximately 30,000 people, operates in more than 30 countries and has more than 100 production facilities globally.

Rail and Truck Businesses Support Diversification

The company’s Rail Vehicle Systems division accounts for roughly 55% of revenue, with Commercial Vehicle Systems contributing the remaining 45%. Kursawe said rail is currently the more profitable segment, with an expected operating EBIT margin of about 17.5% for the year, compared with an expected margin of around 12% in the truck business.

Knorr-Bremse estimates it holds about 50% of the global rail braking market and approximately 23% of the truck braking market. In rail, Kursawe described the competitive market as effectively a duopoly with U.S.-based Wabtec, with the two companies collectively holding roughly 80% of the braking market.

The company’s aftermarket operations are a major element of its business model, accounting for more than 45% of revenue. These sales include spare parts, services and modernization work. Kursawe said the rail aftermarket is particularly resilient because systems must remain compliant with homologation requirements over a train’s operating life, which can last around 40 years or longer.

“We are not only making money with building the rail car or also the truck, but we kind of accompany them the whole life cycle,” Kursawe said. She added that aftermarket business is more profitable than original-equipment business.

From BOOST to Growth Beyond

Kursawe said management introduced its BOOST strategy program in 2023 following market and cost pressures that included weaker conditions in China, post-pandemic inflation and the loss of the company’s Russia business. The program included portfolio reviews and operational improvements.

As part of the portfolio effort, Knorr-Bremse sold five businesses—three in commercial vehicles and two in rail—that management viewed as insufficiently profitable or no longer strategically suitable. It also acquired a U.S. rail signaling business from Alstom in September 2024 and acquired duagon AG, an electronics company serving the rail sector.

The company’s newer Growth Beyond strategy is intended to generate margin-accretive growth while retaining efficiency gains achieved under BOOST. Its four pillars are:

• Investing in margin-strong growth fields;
• Maintaining cost and working-capital discipline;
• Strengthening internal collaboration under its “One Team” initiative; and
• Using digitalization and artificial intelligence across business areas.

Braking systems will remain the core of the business, Kursawe said, while the company targets additional growth in rail signaling, energy technologies and aftermarket operations. In rail, Knorr-Bremse expects the underlying market to grow 3% to 4% annually through 2030 and aims to outperform that rate by an additional 3% to 4% through its identified growth fields. The overall truck market is expected to grow by about 1% through 2030, although the company sees stronger potential in commercial-vehicle aftermarket operations.

2030 Financial Goals and Technology Opportunities

Knorr-Bremse is targeting organic revenue of €10 billion by 2030, an operating EBIT margin of 16%, return on capital employed above 25%, cash conversion sustainably above 90% and free cash flow of more than €1 billion.

Its capital-allocation priorities include organic investment in research and development, capital expenditures and a stable dividend policy. Kursawe said the company typically invests roughly 6% of revenue in R&D, while acquisitions remain a second priority. Potential deals would primarily focus on rail or truck core businesses, adjacent areas and selected growth fields such as energy technologies.

In response to questions, Kursawe said the company sees rail signaling as an attractive expansion opportunity, particularly after entering the U.S. wayside-signaling market through the Alstom transaction. She said the company sees opportunities to expand that technology into markets including South Africa, Australia and India, while a European expansion could require an acquisition because of differing technology standards.

Kursawe also highlighted condition-based monitoring and predictive maintenance as potential areas for digital growth. Data gathered from installed systems could help customers assess equipment condition and allow Knorr-Bremse to provide replacement parts before failures occur, she said.

For highly automated trucks, the company expects redundant braking and steering systems to increase the amount of Knorr-Bremse content per vehicle. Kursawe said the company has indicated that content in autonomous trucks could “almost double” in some cases, while electrification and recuperation technologies also present opportunities.

About Knorr-Bremse (ETR:KBX)

Knorr-Bremse AG, together with its subsidiaries, engages in the development, production, marketing, and servicing of braking and other systems for rail and commercial vehicles worldwide. The company operates in two segments, Rail Vehicle Systems and Commercial Vehicle Systems. The Rail Vehicle Systems segment offers braking systems, entrance and HVAC systems, sanitary systems, coupling systems, digital solutions, smart services for optimizing rail traffic, power electrics, rail computing and communication (RCC)/TCMS, signaling systems, stationary and mobile testing equipment, windshield wiper and wash systems, and extensive aftermarket solutions.

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