A $3.8bn deal points to the future of car-parts suppliers

“It’s a good deal,” beams Klaus Rosenfeld, chief executive of Schaeffler, a maker of car parts based in Herzogenaurach, Bavaria. In the small hours of October 9th he called Andreas Wolf, his counterpart at Vitesco, a Bavarian rival, to offer to buy the 50.1% of the firm Schaeffler did not already own. The €3.6bn ($3.8bn) transaction, says Mr Rosenfeld, will create a competitive German giant in an industry undergoing a huge shift to electric cars.Schaeffler last attempted a big takeover in 2008, when it won a controlling stake in Continental, a rival then three times its size. That deal, financed entirely by debt, almost sank the family-owned business. This time the transaction is smaller—Vitesco, which was itself spun off from Continental in 2021, has annual sales of €9bn, compared with €16bn for Schaeffler. The merger also relies less on borrowed money. And Mr Rosenfeld, who became Schaeffler’s boss in 2014 and took the company public a year later, is a banker by training and cautious by temperament.