EMEA

Automotive sector
Investment in R&D
June 2021
 02 Automotive FDI | EMEA
Research & Forecast Report | Colliers
Introduction Locational Differences
When compared with investment into production,
Figure 2 shows that the distribution of investment
In our recent report of April 2021 examining the evolution of the automotive into R&D certainly differs. The main clusters of
industry across EMEA, we mapped out the distribution and expansion of R&D activity are most apparent in the UK, France,
automotive production across the region over the last 20 years. In this short Germany, Benelux, Spain, and the Nordics, whereas
investment in production has been primarily in CEE
report update, we have looked at a different part of the business – Research &
and Spain. By region, western European markets
Development (R&D) - to assess whether and how corporate investment into this accounted for the largest share of R&D activity (54%)
part of the business differs or matches investment in production. across EMEA, compared to just 36% of investment in
production – the bulk of which has gone into Iberia.
However, frontier and emerging markets also saw
Key facts significant traction due to their growing production
According to fDi Markets, automotive investment into R&D since 2003 has totalled $17.9bn across and consumer bases, most notably markets in MENA
EMEA, creating 57,000 jobs. This is significantly lower than the $250bn invested into production, – with 15% of all R&D investment going into Turkey,
creating over a million jobs, but it does represent a significant level of investment into R&D. In fact, Morocco, Egypt, and UAE. Overall, Basildon took the
the ACEA (European Automobile Manufacturers’ Association) claims that the automotive sector invests top spot, followed by Bursa, Bucharest, Berlin, and
more in R&D in the EU, than any other sector, accounting for 29% of R&D investment. Casablanca. Other notable markets included Dubai,
Izmit, Lyon, Budapest, Tel Aviv, and St Petersburg,
The rapid evolution of society and technology has seen manufacturers and suppliers invest in R&D
where the collective investment of major players,
to push the boundaries of innovation and design, creating safer, cleaner, more fuel-efficient, and
underpinned by small-to-medium auxiliary service
yet more powerful and faster vehicles. Vehicles to suit an increasingly diverse global market and an
companies, helped place these locations. This
increasingly carbon-neutral age.
highlights a divergence in the locational drivers
impacting R&D investment.
Key Drivers of Investment
There is also a clear correlation between the level
of R&D investment and the embedded skills-sets
of locations, built around established flagship
manufacturing plants. For example, the volume of
investment by Jaguar Land Rover in and around
Coventry and Birmingham is just one example, with
Basildon (UK) another, home to Ford production
in the UK. Bratislava and St Petersburg represent
newer Volkswagen, Ford and General Motors (GM)
production plants witnessing significant investment,
but built on established production locations –
Bratislava is now the world’s largest producer of cars
per capita.
Aside from this factor, automotive R&D also
increasingly requires access to top, creative talent.
So, the deployment of investment near the more
established, high value and economically diverse
European cities - typically University cities, which
foster large pools of skilled labour - is also a clear
reason for the focus on western Europe. More
notably, the changes in the evolution of automotive
design and innovation see Berlin feature as a
top location, despite having no car production
experience, with Tesla Motors building their new
Gigafactory, which is due to complete in late 2021.
This points to future divergence in the deployment
of automotive investment and resources, with
implications for changes to the traditional supply
chain model.
The major OEMs led overall R&D investment, with
Ford Motor Company at the top, followed closely by
Renault, TÜV SÜD, General Motors (GM) & Groupe
PSA. Tesla Motors, Volkswagen, Bosch, Jaguar
Land Rover and Continental are other honourable
mentions. The high ranking of TÜV SÜD, Bosch
& Magna Powertrain also highlights the growing
importance of investment into safety and testing in
the industry, alongside component production and
the increasing use of AI and automation to drive the
industry forward.
 03 Automotive FDI | EMEA
Research & Forecast Report | Colliers

Table 1 - Top 20 Locations for Production & R&D Investment (US$) Figure 2 - Production vs R&D Investment Activity, 2003:2020
Manufacturing - CAPEX
Production Ranking R&D Ranking
R&D - CAPEX
1 Barcelona (Martorell), Spain 1 Basildon, UK
Source: Colliers, fDi Markets
2 St Petersburg, Russia 2 Bursa, Turkey
3 Bratislava, Slovakia 3 Bucharest (Titu), Romania
4 Bursa, Turkey 4 Berlin, Germany
5 Izmit, Turkey 5 Casablanca, Morocco
6 Kaluga, Russia 6 Tel Aviv, Israel
7 Zilina, Slovakia 7 Gothenburg, Sweden
8 Vigo, Spain 8 Turin, Italy
9 Moscow, Russia 9 Lyon, France
10 Tangier, Morocco 10 Szczecin, Poland
11 Pamplona, Spain 11 Craiova, Romania
12 Samara (Tolyatti), Russia 12 Coventry, UK
13 Valladolid, Spain 13 St Petersburg, Russia
14 Trnava, Slovakia 14 Warwick (Gaydon), UK
15 Barcelona (Vitoria), Spain 15 Steyr, Austria
16 Solihull (Birmingham), United Kingdom 16 Dubai, UAE
17 Setubal (Palmela), Portugal 17 Bucharest, Romania
18 Genk, Belgium 18 Budapest, Hungary
19 Kragujevac, Serbia 19 Izmit (Golcuk), Turkey
20 Madrid, Spain 20 Graz (Lannach), Austria
Source: Colliers, fDi Markets

Figure 1 - Top 20 Companies for R&D Investment

7,000 Figure 2 plots the distribution of automotive R&D investment
relative to investment in production plants. In the main,
6,000 Renault
Ford Motor Company R&D investment matches production locations given the
5,000 functional linkages, highlighted by Ford’s investment
into Essex (adj London), JLR in the UK midlands, Volvo in
Jobs created

4,000
Gothenburg, VW in Bratislava or General Motors in Turin.
Bosch
3,000 TÜV SÜD
However, some R&D investment has gone into locations
Volkswagen Group
Continental
General Motors (GM)
2,000 Jaguar Land Rover
with no, or limited, historic production capacity - Berlin has
Hyundai Motor Groupe PSA (PSA Peugeot-Citroen)
Valeo Tesla Motors grown due to Tesla Motors’ investment in a new and soon
Toyota / Magna Drivetrain
1,000 Volvo
Aston Martin to be built Gigafactory, Lyon has experienced increasing
Rimac Automobili International Truck Alliance (Intrall)
0 Renault Trucks investment by the component supplier, Koyo Steering
0 0.5 1.0 1.5 2.0 2.5 3.0 Europe, while further south in Toulouse, Continental and
$ Billions Bertrandt have cumulatively invested over $160m.
Source: Colliers, fDi Markets
For more information

Research & Forecasting Occupier Services

Lewis Rapley Karel Stransky
Research Analyst | EMEA Director, Head of Corporate Industrial Advisory |
+44 20 7344 6798 EMEA Corporate Solutions
lewis.rapley@colliers.com +420 603 457 242
karel.stransky@colliers.com
Damian Harrington
Director, Head of Research | EMEA Ernie Himsl
+44 7867 360489 Head of Enterprise Markets Solutions, Occupier
damian.harrington@colliers.com Services | EMEA
+420 733 313 430
Istvan Toth ernie.himsl@colliers.com
Associate Director, Research | EMEA
+44 20 7487 1899 Andrew Hallissey
istvan.toth@colliers.com Executive Managing Director, Occupier Services |
EMEA Corporate Solutions
+44 20 7344 6552
andrew.hallissey@colliers.com

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