Chris Schmidt - istockphoto The German Machinery & Equipment Industry 2013 Market leadership powered by German engineering Jérôme Hull Manager, Mechanical and Electronical Technologies Germany Trade & Invest GmbH September 2013, EMO Hannover, Germany
Agenda 1. The German M&E Market Facts & Figures 2. Business Opportunities in the M&E Market Industrie 4.0 3. The Advantages of Germany as an Investment Location 4. About Germany Trade and Invest (GTAI) 2
The German M&E Market Facts & Figures The Germany M&E industry is back on track, with expected record turnover Facts about the German M&E Industry After having seen a strong sales decline in 2009, the industry recovered in 2010 with a turnover plus of 6 %. 2011 a growth rate of about 12 %, 2012 turnover EUR 207 billion, expecting record turnover in 2013. Annual Turnover of M&E Industry in Germany (in EUR billion) Germany s largest industry by level of activity, with more than 6,000 companies and about 970,000 employees. 133 143 151 167 190 208 161 173 201 207 217 Germany s 16.5 % world trade share of machinery, awards it consecutively the title export world champion. Overall Annual R&D expenditures is at over EUR 13.2 billion - one of the most innovative industries in Germany companies register 28 % of the world s mechanical 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 engineering patents. Source: VDMA (2012) 3
The German M&E Market Facts & Figures Worldwide machinery turnover top 10 countries (2011) Germany EUR 230 bn (+14%) 3 7 8 4 China EUR 563 bn (+15%) USA EUR 276 bn (+7%) 5 1 6 2 South Korea EUR 65 bn (+8%) Italy EUR 107 bn (+8%) 9 Japan EUR 292 bn (+12%) France EUR 49 bn (7%) 10 Great Britain EUR 43 bn (+10%) Brasil EUR 38 bn* Source: VDMA (2012), (*2011) India EUR 40 bn* 4
The German M&E Market Facts & Figures Germany is Export World Champion in the M&E Industry The Global Market Share of the 10 largest M&E Sectors in Germany 2012 (Total export volume, world export share, world market position) Export volume in EUR billion Power transmission engineering Materials handling technology Construction equipm. and building materials machinery Air-handling technology Machine tools Food processing machinery and packaging machinery Agricultural machinery Valves and fittings Precision Tools Compressors, sompressed ait and vacuum techn. 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 21,7% (1) 20,4% (1) 10,5% (3) 11,7% (2) 18,1% (2) 21,8% (2) 17,7% (1) 13,7% (2) 15,4% (1) 16,0% (1) Source: VDMA (2012), GTAI Research (2013) 5
Agenda 1. The German M&E Market Facts & Figures 2. Business Opportunities in the M&E Market Industrie 4.0 3. The Advantages of Germany as an Investment Location 4. About Germany Trade and Invest (GTAI) 6
Business Opportunities Industrie 4.0 The four stages of Industrial Revolution from centralized mechanization processes to integrated value-added chains Mechanisation Electrification Automatisation Integration Source: DFIK 2013 7
Business Opportunities Industrie 4.0 The vision behind the smart factory concept Industrie 4.0 What is Industry 4.0? What are the objectives of Industry 4.0? Cyber-Physical Systems (CPS): machines, storage, production facilities etc. exchange information, trigger actions and independently control each other. Industrial processes become more vertically integrated and can be managed more efficiently and flexible Self-organizing, Adaptive Logistics Resilient Factory Technology Marketplace Products in Smart Factories are always traceable. Operational and embedded production processes are horizontally linked and controllable in real time from order to supply Continuous engineering over the whole life cycle becomes possible. Networked Production Intelligent Maintenance Within the High-Tech Strategy 2020 Action Plan, Industrie 4.0 has received special attention in realizing current innovation policy objectives: 200 Mio subventions Customer-Integrated Engineering Source: Acatech2013; Industrie 4.0 Platform http://www.bmbf.de/pubrd/umsetzungsempfehlungen_industrie_4.0_final_2012-10-02.pdf 8
Agenda 1. The German M&E Market Facts & Figures 2. Business Opportunities in the M&E Market Industrie 4.0 3. The Advantages of Germany as an Investment Location 4. About Germany Trade and Invest (GTAI) 9
Advantages of Germany as an Investment Location Leading Economy Quality of Life 10 1 2 Global Player Secure Investment Environment 9 3 High Productivity Competitive Tax Conditions 8 4 Excellent Workforce Inviting Incentives 7 5 Power of Innovation 6 First-Class Infrastructure 10
Advantages of Germany as an Investment Location Germany s share of GDP from industrial production is comparatively high, making Germany the largest manufacturer in Europe. GDP of G8-Countries by Sector (2012, in %) Development of Industrial production sales in selected countries (2012) Russia 36,0 60,1 Germany 30,5 68,5 Japan* 30,1 68,3 Canada 28,7 69,3 Italy 24,2 73,8 United Kingdom* 21,7 77,0 USA 19,3 79,6 France 19,0 79,0 0 50 100 *2011 data Agriculture Industry Services Source: The German Federal Environment Ministry Source: VDMA 2012 Note: *refers to EU-28; Source: IMD 2012, Eurostat 2013 11
Advantages of Germany as an Investment Location Germany is a major global R&D player. Germany s federal states R&D expenditures correspond with that of other European countries. German Machinery & Equipment Innovation Expenditures 2006-2012 (in EUR bn) Global Top 10 - R&D Expenditures (2011, in EUR bn) Global Top 10 - R&D Expenditures (2011, in EUR bn) 16 USA 298,3 14 12 10 3,1 3,3 4.0 2,7 2,6 3,1 12,8 Japan* China Germany 128,5 96,6 73,6 8 France 44,9 6 4 5,8 5,6 6.0 6,3 5,6 5,4 United Kingdom Korea* 31,0 27,3 2 0 8,1 8,8 9,6 8,8 9,1 9,6 2006 2007 2008 2009 2010 2011 2012 Canada Australia* 21,7 20,4 investment-related innovation expenditures ongoing innovation expenditures percentage of innovation expenditures to turnover Italy 19,7 0,0 100,0 200,0 300,0 400,0 Source: VDMA (2013); Note: For 2012 only forecasts available; Source: OECD 2013 according to OECD, UNESCO 2012 (right) 12
Advantages of Germany as an Investment Location Germany s high-tech industries like machinery, automotive, chemicals and electrical equipment perform outstandingly strong. Share of High-Tech Industries of Gross Value Added (in %, 2010) 1 4,5 4,0 3,9 3,5 3,0 3,4 3,0 2,5 2,2 2,0 1,5 1,0 0,5 1,8 1,8 0,9 1,2 1,6 0,7 0,5 1,1 1,1 0,6 0,4 0,9 0,0 Germany Japan EU-14 USA Machinery Automotive Electrical Equipment Chemicals Source: German Institute of Economic Research (DIW) 2013; Note: 1 High-tech industries are characterized by high internal R&D expenditures of between 2.5%-7% of the average OECD turnover; Cutting-edge technologies show an internal R&D intensity of more than 7% of the average OECD turnover 13
Advantages of Germany as an Investment Location R&D Excellence // Germany s top innovation clusters - Kompetenznetze Selected M&E industry-related innovation clusters in Germany Universities, research centers and companies establish interdependent relations with access to technology and supplier networks, creating innovative value chains. Collaboration between industry and research is improved and foreign investors can find information and project partners for R&D. The Clusterplattform Deutschland provides information on cluster policy measures, as well as on upcoming events, and essentially serves to facilitate access to the individual initiatives. It also encourages a mutual and intensive exchange of information and experience relating to the measures, their development, and impact. Source: Fraunhofer Innovation Clusters, GO-CLUSTER Initiative 14
Agenda 1. The German M&E Market Facts & Figures 2. Business Opportunities in the M&E Market Industrie 4.0 3. The Advantages of Germany as an Investment Location 4. About Germany Trade and Invest (GTAI) 15
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