The European Commission has today
published its 2013 EU Industrial R&D Investment Scoreboard. The
Scoreboard is based on a sample of 2,000 companies, the world's top
investors in Research and Development (R&D) representing more than
90% of the total expenditure on R&D by businesses worldwide. Leading
world R&D investors have continued to increase their R&D
investments by 6.2% in 2012, a figure above their net sales growth
(4.2%). The 527 EU companies increased R&D investment and net sales
by the significant figures of 6.3 % and 4.3 % respectively. The 658 US
companies reported a higher increase in R&D (8.2 %) but net sales
grew only by 2.9 %, compared with a strong increase in 2011.
What percentage of R&D spending do EU firms account for in the Scoreboard?
Out of
the 2,000 companies gathered in the Scoreboard, 527 are based in the EU.
These companies invested €158 billion in 2012, equivalent to 29.3 % of
the overall investment in R&D by the Scoreboard companies.
Distribution of the 527 EU companies in the 2013 R&D Scoreboard
Germany 130; United Kingdom 107;
France 75; Sweden 40; The Netherlands 35; Italy 30; Denmark 25; Finland
20; Spain 16; Belgium 13; Austria 12; Ireland 11; Luxembourg 4 ;
Portugal 4 ; Czech Republic 1; Greece 1; Hungary 1; Malta 1; Slovakia 1.
What are the EU's top 10 R&D investing companies?
Expanded EU analysis Top 1,000 companies: trends in the 10 Top Member States by R&D investment of Scoreboard companies
Companies based in the 10 top
R&D investing Member States account for 97.3 % of the total R&D
of the Top 1000 EU companies1
(these all have R&D investments exceeding €5.2 million). Those
based in Germany, the top R&D investor, continued the good
performance shown in the past year, increasing R&D in 2012 well
above the top 2000 world R&D investors' average, at 11.6 %. On the
contrary, companies based in the UK and France showed a poor
performance, increasing R&D by 0.5 % and 2.3 % respectively.
Among the group of 10 largest EU
countries (by R&D investment of Scoreboard companies based in that
country), those whose companies increased R&D above the EU's average
were Italy (18.3 %), Ireland (10.7 %), the Netherlands (7.7 %) and
Sweden (6.7 %). Companies based in three countries decreased R&D in
2012: Finland (-10.3 %), Denmark (-3.0 %) and Spain (-2.1 %).
In many countries, the aggregate
country indicators depend to a large extent on the figures of a very few
firms. For example, the R&D growth of Fiat (51.5%), accounting for
more than 36 % of the R&D of companies based in Italy, contributed a
significant part of the R&D growth of that country. Three companies
from the Automobiles & Parts sector, accounting for 32% of the
R&D of companies based in Germany, contributed a large part of the
that country's R&D growth: Volkswagen (32.1 %), Robert Bosch (16.1
%) and BMW (17.2 %). It is important to note that the growth of
companies is often accompanied by mergers and acquisitions. Relevant
cases of M&A involving Scoreboard companies in 2012 are referred to
in the SB report and include for example the acquisition of Porsche by
Wolkswagen (from 49.9% to 100%) and of Motorola Mobility by Google
(acquisition of 100%).
Which companies and sectors invest the most, and who are the overall best performers?
For the first time since 2004, a
company based in the EU leads the world R&D ranking: the German
carmaker Volkswagen with €9.5bn invested in R&D. Samsung Electronics
from South Korea jumps to the second place. The other companies in the
top ten are five from the US (three pharma --Merck US, Johnson &
Johnson and Pfizer, and two ICT --Microsoft, Intel), two from
Switzerland (both pharma --Roche and Novartis) and one from Japan
(automobile, Toyota).
The largest R&D increases in
the 100 top companies continue to be, as in 2011, in the Automobiles
& Parts and in the ICT sectors: e.g., Tata Motors, India (77.6%);
Fiat, Italy (51.5%); 3M, US (57.7%); Western Digital, US (49.0%);
Apple, US (39.2%); Volkswagen, Germany (32.1%); QUALCOMM, US (30.7%),
HUAWEI, China (30.3%), GOOGLE, US (27.7%).
Among the top 100 group, 14
companies have simultaneously increased R&D and net sales by more
than 200% since 2004 while showing positive operating profits in the
last reporting period. Nine of these companies are based in the US, two
in China and one each in Taiwan, India, Brazil and Canada. The first
five are ICT companies based in the US: Google (Internet), Oracle
(Software), Qualcomm (Telecom Equipment), Apple (Computer Hardware) and
Broadcom (Semiconductors).
What is the performance of EU companies compared to US?
Scoreboard companies in the
Software and Computer Services sector based in the EU show very strong
increases: 14.2% in R&D growth, coupled with 9.7% growth in sales
(against 12.6% and 6.9% respectively for the US). This contrasts with
negative figures in the Technology Hardware & Equipment sector for
EU companies (-2.3% in R&D and -9.3% in sales) while very positive
developments (14.8% and 6.8% respectively) are observed for US ones.
In the Automobiles & Parts,
Industrial Engineering and Aerospace & Defence sectors, EU based
companies' growth clearly outperforms that of their US counterparts. For
the Automobiles & Parts sector, EU companies show very high
increases in R&D investment and sales (14.2% and 11.3% respectively)
vs US based automobiles & parts companies (-2.6% for R&D and 0%
for sales growth). In the case of the Aerospace & Defence sector,
strong regional differences are also observed in favour of the EU:
increases of 9.5% in R&D and 8.3% in sales (against -1.3% and 6.7%
respectively in the US).
In 2012, the Scoreboard companies of the
pharmaceutical and biotech sector based in the US slowed-down, (4.3% in
R&D but -0.3% in sales, compared with 3.2% and 2.8% respectively in
the EU). However, the trend over the last ten years shows that the
EU-US R&D investment gap in this sector is maintained. A detailed
analysis of the therapeutic biotechnology subsector shows the dominance
of the US: nine of the top ten companies are based in this country.
Evidence also shows that there are a number of examples of EU companies
which show both high performance and the ability to grow to a
sustainable size through well-chosen collaborations, mainly with the
large pharmaceutical counterparts.
The above described divergent
sectoral performances observed in 2012 point to a reinforcement of their
relative specialisation: towards medium-high R&D intensive sectors
in the EU and towards high R&D intensive sectors in the US ones.
Where do EU-based companies perform their research?
In the context of the Scoreboard,
companies are allocated to the country of their registered office, which
might differ from the place where R&D activities are undertaken.
“EU companies” are those whose ultimate parent is registered in an EU
Member State. Evidence compiled in the EU and by the OECD show that
multinational groups tend to invest around 80% in the region where they
are registered, therefore Scoreboard figures correlated fairly closely
with the overall private sector R&D investment trends in each region
of the world (not necessarily the same case for countries).
What kind of data does the Scoreboard present?
The Scoreboard collects companies’
key R&D and economic indicators namely R&D investment, net
sales, capital expenditures, operating profits and number of employees.
Data correspond to the companies’ latest published accounts. For most
companies these correspond to calendar year 2012, but a significant
proportion have financial years ending on 31 March 2013. The R&D
investment included in the Scoreboard is the cash investment that is
funded by the companies themselves. It excludes R&D funded by
contracts with third parties such as governments or other firms.
Companies' behaviour and performance can be analysed over longer time
periods using our history database that contains information on the top
R&D companies since 2003. This enables benchmarking analyses of
companies across sectors and countries, for example to identify
companies showing outstanding economic or innovation results and to
analyse the main factors underlying such successful dynamics.
The Scoreboard is part of the
European Commission’s monitoring activities to improve the understanding
of trends in R&D investment, created in response to the
Commission’s Research Investment Action Plan.
Is the crisis over?...
Trends over the past 10 years show
that companies based in the EU and the US have recovered levels of
R&D investment prior to the crisis whereas that of net sales, that
recovered significantly in 2010-2011, fell well below the rate of
R&D growth in 2012.
What can be observed about employment in Scoreboard companies?
The companies listed in this year's Scoreboard employed 48.471 million people in 2012, 1.5% more than the previous year.
In the period 2004-2012, the overall worldwide employment of Scoreboard companies2 increased by 27.9% led by increases in high R&D-intensive sectors (42.0%) and medium-high ones (29.9%).
For the EU companies, the overall
employment growth was 22.6%, increasing by 49.2% in high
R&D-intensive sectors and by 24.2% in medium-high sectors.
Is Europe an attractive place for R&D investments from third countries?
The EU, together with US, plays a
major role in the international investment scenario, both as source and
destination of the knowledge intensive foreign direct investments
(FDIs). From 2003-2012, the EU attracted 22% of FDI projects on R&D
from the set of non-EU companies while US receive only a share of 8 %
(source: FT fDi Markets database). Six out of the 10 countries with the
highest number of international projects are European.
EU proportionally attracts more
knowledge-intensive than manufacturing investments (29% inflow of FDIs
in R&D versus 26% inflow of manufacturing FDIs).
Most of FDIs are originating from
the UE, US and Japan, while BRIC countries –led by China-- are the main
"attractors", together with EU and US.
FDIs in R&D are concentrated
mainly in 3 sectors: IT Hardware, Automobile and Parts, and
Pharmaceuticals & Biotechnology.
Main results from the 2013 EU R&D Survey
The 2013 EU Survey on Industrial R&D
Investment Trends, published today, presents the main findings of the
eighth survey on industrial R&D investment trends. It analyses the
172 responses of mainly large firms from the expanded sample of 1000
EU-based companies investing the largest R&D amounts analysed in the
2012 EU Industrial R&D Investment Scoreboard. In total, the 172
responding companies are responsible for R&D investment of almost €
62 billion. This is equivalent to around 41 % of the total R&D
investment by the 1000 EU Scoreboard companies. The main findings of the survey are as follows:
Between 2013-15, the responding companies expect to increase their R&D investments by 2.6 %
on average per year. Due to decreased expectations in the automobiles
& parts sector, this is a third lower than in the previous survey
(4%).
Figure 2: Expected changes of R&D investment of the surveyed companies 2013-15.
The companies in the sample carry
out a quarter of their R&D outside the EU. The largest share of
R&D investment outside the EU is in the US and Canada (10 %),
followed by rest of the world (5 %), China (4 %), Japan (2 %), other
European countries (2 %), and India (1 %). Their expectations for
R&D investment for the next three years show continued participation
of European companies in the global economy, in particular growth opportunities in emerging economies, while maintaining an R&D focus in the EU.
Two thirds of the European companies in the sample state their home country as the most attractive location for R&D. The US, Germany, China and India are as the most attractive locations outside the home country.
Knowledge-sharing, human resources, proximity to other company sites and market demand
make countries attractive for R&D activities. Knowledge-sharing and
collaboration opportunities are an important factor of country
attractiveness not only for companies. They are widely recognised as a
priority issue in many Member States and for completing the European
Research Area (ERA).
Source: 2013 EU Industrial R&D Investment Scoreboard. European Commission, JRC/DG RTD.
1
:
The top 1,000 R&D investors in the
EU is an extended sample of companies representing, the 527 EU companies
included in the world top 2,000 sample and 473 additional companies
based in the EU.
