R&D investments up by 7 percent – 114,000 employs in Germany
The German automotive industry has again increased its spending on research and development (R&D). According to the European Commission, global spending in 2016 increased to 40.2 billion euros. That's an increase of 7 percent compared to the previous year. Germany's automotive industry thus accounts for more than one third of total global R&D spending in the automotive sector, putting it at the top of the league – ahead of Japanese and American companies. Indeed, four of the top ten investors in the global automotive industry are German companies.
A good fifty percent of R&D spending is invested in Germany: Domestic spending on R&D grew by 2 percent to 21.9 billion euros. Of this, a good two thirds (68 percent) came from vehicle manufacturers and nearly one third (32 percent) from suppliers. That equates to a 35-percent share of total R&D expenditure by German industry as a whole. The automotive industry is thus also a top performer compared to other German business sectors.
No other sector has so many highly qualified employees engaged in the field of innovation. In fact, the automotive sector employs more than a quarter of German industry’s total R&D workforce (28 percent or 114,000 employees). Some 40% of R&D employees in the automotive industry work for supplier companies and 60 percent for OEMs. At the same time, workforce growth in R&D departments is outstripping aggregate employment: Since 2010, almost one in four new jobs in the German automotive industry has been in R&D – that's 25,000 additional highly skilled workplaces. These figures are based on data by Germany's Stifterverband. 'With digitalisation and the advent of alternative drivetrains, Germany's automotive industry is facing a challenging process of transformation. That's why German manufacturers and suppliers are investing heavily in future mobility and engaging in research more intensively than ever before. They know that their continued success depends on maintaining a fast pace of innovation,' said Matthias Wissmann, President of the German Association of the Automotive Industry (VDA).
The VDA President stressed that, while continuing to optimise the combustion engine and invest in connected and autonomous vehicles (CAV), a major R&D focus is on the development of alternative drivetrains. Through to 2020, Germany's automotive industry is planning to invest some 40 billion euros in alternative propulsion systems. And over the next five to eight years, German manufacturers will be putting more than 150 new electric-powered models on the roads. Even before 2020, electric drives (PHEV, BEV) will be available in all segments, from the compact class to the SUV – with driving ranges of more than 500 kilometres on a single full battery charge. Roughly one third of all patents worldwide for electric mobility (34 percent) and hybrid drives (32 percent) come from Germany. 'With regard to electric mobility, Germany's automotive industry does not just aim to be one of the leading suppliers. It also aims to make the German passenger car market the leading market for electric mobility,' says Wissmann.