GHG‐TransPoRD Reducing greenhouse‐gas emissions of transport beyond 2020: linking R&D, transport policies and reduc‐ tion targets
Transport R&D Capacities in the EU An analysis of present research efforts for reducing transport-related GHG emissions and the European innovation system transport Deliverable D1
Due date of submission:
31.07.2010
Actual date of submission: 06.08.2010 Dissemination level: Public Start date of project:
01.10.2009
Duration: 24 months
Lead contractor for this deliverable:
IPTS
Work package: WP1
Revision: Final
Grant Agreement Number: 233828 Contract No: TCS8-GA-2009-233828
Project co-funded by the European Commission – DG RTD 7th Research Framework Programme
GHG‐TransPoRD Reducing greenhouse‐gas emissions of transport beyond 2020: linking R&D, transport policies and reduction targets Instrument: Coordination and support actions – Support – CSA-SA
Co-ordinator: ISI Fraunhofer Institute Systems and Innovation Research, Karlsruhe, Germany Dr. Wolfgang Schade
Partners: TRT Trasporti e Territorio SRL, Milan, Italy
IPTS Institute for Prospective Technological Studies European Commission – DG-JRC, Seville, Spain TML Transport & Mobility, Leuven, Belgium
ITS Institute for Transport Studies University of Leeds, United Kingdom
Transport R&D Capacities in the EU
v
GHG-TransPoRD Reducing greenhouse-gas emissions of transport beyond 2020: linking R&D, transport policies and reduction targets Report information: Report no:
D1
Work package no:
1
Title: Authors:
Transport R&D Capacities in the EU Guillaume Leduc, Tobias Wiesenthal, Burkhard Schade (IPTS) Jonathan Köhler, Wolfgang Schade, Luis Tercero (Fraunhofer – ISI)
Version:
Final
Submission: 06.08.10
Date of publication: 27.10.2010
This document should be referenced as: Leduc, G., Köhler, J., Wiesenthal, T., Tercero, L., Schade, W., Schade, B. (2010): Transport R&D Capacities in the EU. Deliverable report of GHG-TransPoRD (Reducing greenhouse-gas emissions of transport beyond 2020: linking R&D, transport policies and reduction targets). Project co-funded by European th Commission 7 RTD Programme. Fraunhofer-ISI, Karlsruhe, Germany.
Project information: Project acronym:
GHG-TransPoRD
Project name:
Reducing greenhouse-gas emissions of transport beyond 2020: linking R&D, transport policies and reduction targets TCS8-GA-2009-233828 01.10.2009 – 30.09.2011 European Commission – DG RTD – 7th Research Framework Programme. ISI - Fraunhofer Institute Systems and Innovation Research, Karlsruhe, Germany. TRT - Trasporti e Territorio SRL, Milan, Italy. IPTS - Institute for Prospective Technological Studies, European Commission – DGJRC, Seville, Spain. TML - Transport & Mobility, Leuven, Belgium. ITS - Institute for Transport Studies, University of Leeds, United Kingdom. http://www.ghg-transpord.eu/
Contract no: Duration: Commissioned by: Lead partner: Partners:
Website:
Document control information: Status:
Approved
Distribution:
GHG-TransPoRD partners, European Commission
Availability:
Public (once status above is approved)
Filename:
GHG_TransPoRD_D1_Innovation_and_RDD_Analysis.pdf
Quality assurance:
Imke Gries
Coordinator`s review:
Wolfgang Schade
Signature:
Date:
vi
GHG-TransPoRD D1
Transport R&D Capacities in the EU
vii
Table of Contents Acknowledgments........................................................................................xviii Executive summary and conclusions .............................................................1 Introduction .......................................................................................................8 PART I – Quantitative assessment of present R&D efforts ...........................9 1. Scope of the quantitative assessment ....................................................10 2. Methodology..............................................................................................13 2.1
Methodology for estimating corporate R&D investments ...........13
2.2
Methodology for estimating public R&D investments of EU Member States .....................................................................19
2.2.1
GBAORD (Government Budget Appropriations or Outlays on R&D) ........................................................................19
2.2.2
IEA RD&D statistics ...................................................................20
2.2.3
Other information sources ..........................................................22
2.3
EU FP7 public transport R&D investments ................................25
2.4
Search of patent applications .....................................................26
3. RESULTS I – Overall R&D investments in transport ..............................29 3.1
Corporate R&D investments ......................................................29
3.1.1
Overall analysis based on the EU Industrial R&D Investment Scoreboard ..............................................................30
3.1.2
BERD (Business enterprise sector's R&D expenditures) ...........43
3.1.3
Comparison between EU Industrial R&D Investment Scoreboard and BERD...............................................................44
viii
GHG-TransPoRD D1
3.2
Public R&D investments from Member States .......................... 48
3.3
Transport-related R&D investments under FP7 ........................ 49
3.4
Key outcomes from the overall analysis .................................... 56
4. RESULTS II – R&D investment for reducing GHG emissions by mode and technology. Results from a bottom-up analysis.................. 57 4.1
Road transport .......................................................................... 57
4.1.1
Total corporate R&D.................................................................. 58
4.1.2
Corporate R&D investments for reducing GHG emissions ........ 63
4.1.3
Public research.......................................................................... 66
4.1.4
R&D investment in road vehicle technologies ........................... 66
4.1.5
Synthesis ................................................................................... 71
4.2
Air transport ............................................................................... 74
4.3
Maritime transport ..................................................................... 77
4.4
Rail transport ............................................................................. 80
4.5
Key outcomes from the bottom-up analysis .............................. 82
5. RESULTS III – Outcome of the patents analysis ................................... 84 5.1
Dynamics of patent applications ................................................ 84
5.2
Patenting activity by country ...................................................... 86
5.2.1
Hybrid and electric vehicles ....................................................... 87
5.2.2
Mobile fuel cells ......................................................................... 87
5.2.3
Biofuels ..................................................................................... 88
5.3
Snapshot of patenting activity by company ............................... 89
5.3.1
Hybrid and electric vehicles ....................................................... 90
5.3.2
Mobile fuel cells ......................................................................... 92
5.3.3
Biofuels ..................................................................................... 94
5.4
Key outcomes from the patents analysis ................................... 96
Transport R&D Capacities in the EU
ix
PART II – Qualitative analysis of the innovation systems transport ..........97 6. Technology Innovation System analysis of low carbon cars ...............98 6.1
Introduction and scope of the analysis .......................................98
6.2
Low carbon innovations in cars ..................................................99
6.2.1
The rush to electric vehicles .....................................................100
6.2.2
The decisive impact of policy ...................................................102
6.3
Methodology ............................................................................104
6.4
Analysis....................................................................................106
6.4.1
Actors .......................................................................................108
6.4.2
Networks ..................................................................................111
6.4.3
Institutions ................................................................................113
6.5
Levels of activity in the functions of the innovation system......................................................................................114
6.5.1
Knowledge creation..................................................................114
6.5.2
Guidance on the direction of search.........................................114
6.5.3
Entrepreneurial experimentation ..............................................115
6.5.4
Market formation ......................................................................116
6.5.5
Resource mobilization ..............................................................116
6.5.6
Legitimation ..............................................................................117
6.5.7
Development of positive externalities or ‘free utilities’: knowledge diffusion through networks .....................................117
6.6
Conclusions: Environmental innovation in the Automobile Industry ....................................................................................118
7. Innovation systems of aviation, railways and maritime ......................122 7.1
The aviation sector innovation system .....................................122
7.2
The innovation system in railways ...........................................125
7.3
The maritime innovation system ..............................................128
7.4
Common aspects of the innovation systems in aviation, railways and shipping ...............................................................130
x
GHG-TransPoRD D1
8. Innovation system of transport (ISyT) .................................................. 130 8.1
Further analysis of ISyT – functions of ISyT ............................ 130
8.2
Conclusions ............................................................................. 133
References .................................................................................................... 134 Abbreviations and Acronyms ...................................................................... 145 ANNEX I: KEY EU-BASED COMPANIES AND DIVISIONS ......................... 146 ANNEX II: QUALITITATIVE ASSESSMENT OF EUROPEAN R&D ACTORS AND PROGRAMMES .............................................................. 148 9. European R&D actors and programmes .............................................. 149 9.1
Road transport ........................................................................ 149
9.2
Air transport ............................................................................. 152
9.3
Rail and maritime .................................................................... 154
9.4
Alternative motor fuels............................................................. 156
10. National R&D actors and programmes................................................. 158 10.1
Germany ................................................................................. 158
10.2
France ..................................................................................... 159
10.3
UK ........................................................................................... 166
10.4
Sweden ................................................................................... 168
10.5
Spain ....................................................................................... 170
10.6
Italy.......................................................................................... 172
10.7
Poland ..................................................................................... 175
11. Overview of product-related environmental innovations by automotive manufacturers .................................................................... 189
Transport R&D Capacities in the EU
xi
Transport R&D Capacities in the EU
xii
List of tables Table 0-1:
Summary of results – Approximates for the year 2008 .................... 7
Table 2-2:
IEA categories related to transport RD&D budgets ........................ 21
Table 2-3:
Key sources providing qualitative and quantitative information on national transport R&D activities............................. 24
Table 3-4:
Pros and Cons of the overall assessment ...................................... 29
Table 3-5:
R&D investments, sales and total number of employees related to the 'Transport' sector (2008)........................................... 31
Table 3-6:
R&D investments, sales and total number of employees of the EU automotive industry (2008) ................................................. 41
Table 3-7:
Business and enterprise R&D expenditures in transportrelated fields in 2008 aggregated for EU Member States............... 44
Table 3-8:
Aggregated corporate R&D support to selected transport sectors at world level (2008)........................................................... 46
Table 3-9:
Aggregated public R&D budget of selected transport subsectors in selected EU countries .............................................. 48
Table 3-10:
Public RD&D budgets allocated to transport-related R&D activities .......................................................................................... 49
Table 4-11:
Approximate R&D investments in the EU automotive sector (2008) ............................................................................................. 58
Table 4-12:
Approximate R&D investments in road vehicle technologies (2008) ............................................................................................. 69
Table 4-13:
Approximate R&D investments in civil aeronautics (2008) ............. 74
Table 4-14:
Approximate R&D investments in maritime transport (2008) ......... 77
Table 4-15:
Approximate R&D investments in rail transport (2008) .................. 80
Table 6-16:
Summary of EU emissions reduction policies for automobiles .................................................................................. 104
Table 8-17:
Indicators to deepen the analysis of ISyT for the different functions ....................................................................................... 132
Table 9-18:
2030 guiding objectives (2010 baseline) ...................................... 150
Table 9-19:
Key EU and world bodies of the road transport sector ................. 152
Table 9-20:
Key EU and world bodies of the air transport sector .................... 154
Transport R&D Capacities in the EU
xiii
Table 9-21:
Key EU and world bodies of the rail/maritime transport sector ............................................................................................155
Table 10-22:
Key French public organisms undertaking transport-related R&D ..............................................................................................162
Table 10-23:
PREDIT 4 programme ..................................................................163
xiv
GHG-TransPoRD D1
List of figures Figure 1-1:
Schematic illustration of the approach for the present study .......... 11
Figure 2-2:
Distribution of R&D investments per research employee ............... 16
Figure 2-3:
Schematic overview of the methodology ........................................ 18
Figure 2-4:
Overview of actors and programmes in transport research at EU level (simplified) .................................................................... 22
Figure 3-5:
Weight of transport-related sectors with regard to R&D investments, sales and number of employees – World level (2008) ............................................................................................. 32
Figure 3-6:
Distribution of R&D investments from transport-related companies worldwide (2008) .......................................................... 33
Figure 3-7:
Evolution of R&D investments and R&D intensity from EU and non-EU based transport-related companies over the period 2002-2008 ........................................................................... 34
Figure 3-8:
Evolution of R&D investments and R&D intensity from EU and non-EU based automotive manufacturers over the period 2002-2008 ........................................................................... 35
Figure 3-9:
Evolution of R&D investments and R&D intensity from EU and non-EU based automotive suppliers over the period 2002-2008 ...................................................................................... 36
Figure 3-10:
Evolution of R&D investments and R&D intensity from EU and non-EU based industry of the 'Commercial vehicles and trucks' category over the period 2002-2008 ............................ 37
Figure 3-11:
Evolution of R&D investments and R&D intensity from EU and non-EU based industry of the 'Aerospace and defence' category over the period 2002-2008............................................... 38
Figure 3-12:
Weight of the 'transport' sector on R&D investments, sales and number of employees – EU27 ................................................. 39
Figure 3-13:
Cumulated corporate R&D expenditures from EU-based companies investing in transport R&D (2008) ................................ 40
Figure 3-14:
R&D investment of the EU automotive industry in 2008................. 42
Figure 3-15:
Comparison of worldwide R&D investments between the two databases over the period 2002-2008 (total transport and NACE 34 category; data in real terms €2005) ............................ 47
Transport R&D Capacities in the EU
xv
Figure 3-16:
Transport-related research under FP7 (indicative budget) ............. 50
Figure 3-17:
Overall FP budget allocated to the aviation sector .........................54
Figure 4-18:
Recent trends in net sales, R&D investments and R&D intensity of the EU automotive industry (2007-2009; normalised data 2007=1) ................................................................62
Figure 4-19:
Approximate R&D breakdown and intensity of the EU automotive industry in 2008 ............................................................64
Figure 4-20:
R&D investment flows in road vehicle technologies for reducing GHG emissions (overall picture only, R&D topics coloured in grey are those for which the R&D investment will be estimated). ...........................................................................68
Figure 4-21:
Overall public and private R&D investment flows in the automotive sector in 2008 ...............................................................72
Figure 4-22:
Share of public R&D investment into different road technologies (2008) ........................................................................73
Figure 4-23:
R&D investment into GHG emissions reduction technologies by source of funds (2008) ..........................................73
Figure 4-24:
Overall turnover and R&D spending flows of the aerospace and defence sector in 2008 ............................................................75
Figure 5-25:
International patent applications (PCT+EPO, overlap excluded) pertaining to the three selected technology fields. For comparison, the number of international patent applications was indexed for all technology fields, with the number of patent applications in the year 1990 corresponding to an index of 100. ..................................................85
Figure 5-26:
Annual number of patent applications related to electric vehicles and fuel cell vehicles from the EU automotive industry over the period 1990-2009 ................................................86
Figure 5-27:
Breakdown of European patents pertaining to hybrid and electric vehicles, differentiated by country ......................................87
Figure 5-28:
Breakdown of European patents pertaining to mobile fuel cells, differentiated by country ........................................................88
Figure 5-29:
Breakdown of European patents pertaining to biofuels, differentiated by country .................................................................89
Figure 5-30:
Workflow for identifying applicants in each technology field and for ascertaining the share of relevant patent
xvi
GHG-TransPoRD D1
applications compared to the total patent applications for each applicant. ............................................................................... 90 Figure 5-31:
Share of the different applicants in the year 2007 for hybrid and electric vehicles ....................................................................... 91
Figure 5-32:
(left) Specialization of applicants in the field of hybrid and electric vehicles expressed as the share of relevant patents in the overall portfolio of a company/institution. (right) Specialization of patent applicants in the field of hybrid and electric vehicles expressed as a function of their relative contribution to patents in this field for the year 2007. ..................... 92
Figure 5-33:
Share of the different applicants in the year 2007 for mobile fuel cells ......................................................................................... 92
Figure 5-34:
(left) Specialization of applicants in the field of mobile fuel cells expressed as the share of relevant patents in the overall portfolio of a company/institution. (right) Specialization of patent applicants in the field of mobile fuel cells expressed as a function of their relative contribution to patents in this field for the year 2007.............................................. 93
Figure 5-35:
Share of the different applicants in the year 2007 for biofuels ........................................................................................... 94
Figure 5-36:
(left) Specialization of applicants in the field of biofuels expressed as the share of relevant patents in the overall portfolio of a company/institution. (right) Specialization of patent applicants in the field of biofuels expressed as a function of their relative contribution to patents in this field for the year 2007. ........................................................................... 95
Figure 6-37:
A sectoral system of innovation .................................................... 105
Figure 6-38:
Application of the Sectoral System of Innovation and TIS approaches ................................................................................... 106
Figure 6-39:
The innovation system for automobiles ........................................ 107
Figure 6-40:
Examples of partnerships worldwide for developing electric vehicles (PHEVs, HEVs, BEVs) ................................................... 112
Figure 7-41:
Innovation system Aviation ........................................................... 124
Figure 7-42:
Innovation system Railways ......................................................... 127
Figure 7-43:
Innovation system Shipping ......................................................... 129
Figure 8-44:
Functions of ISyT ......................................................................... 131
Transport R&D Capacities in the EU
xvii
Figure 8-45:
The reinforcing feedback between functions of the ISyT .............. 133
Figure 10-45:
Overview of Spanish transport research actors and programmes ..................................................................................171
xviii
GHG-TransPoRD D1
Acknowledgments This report has been prepared as part of the FP7 co-funded project GHG-TransPoRD. The authors wish to acknowledge all partners of the consortium for their valuable contributions to this report. For the input to the descriptions of individual country's R&D systems we would like to thank Prof Peter Mackie and Prof David Watling from ITS Leeds as well as Matthew White (DfT) for the UK description; Inge Vierth (VTI) for the Swedish part; JeanFrançois Gruson (IFP) for the French case study; Andreas Dorda (BMVIT) for his input on the Austrian R&D system in transport; and Alessandra Moizo (TRT) for drafting the Italian case. The authors would also like to thank Thomas Schubert (EC) for the provision of data on funding under FP7 and Gabriele Jauernig (GOPA-Cartermill) for data input extracted from the Transport Research Knowledge Centre database. This work has been presented and discussed during the joint GHG-TransPoRD/IEA stakeholder meeting on 17th and 18th June 2010 in Paris. The authors are grateful for the high-level discussion that helped in improving the analysis. A draft of this report has been circulated to several stakeholders at the EU-level, including the EU technology platforms ERTRAC, ACARE, ERRAC, WATERBORNE-TP, the ERA-NET projects AirTN, MARTEC and ERA-NET TRANSPORT, as well as EUCAR. We would like to acknowledge the input received from this review, in particular from Simon Godwin (EUCAR) and Xavier Aertsens (ERTRAC).
Transport R&D Capacities in the EU
1
Executive summary and conclusions A change towards more environmental sustainability is one of the central challenges faced by the (European) transport sector. Technological improvements will play a central role in achieving this change, complementing other measures1. Yet, the currently dominating technological portfolio will be insufficient for reducing the sector's emissions in line with European climate change targets (Schade et al., 2010; Fontaras and Samaras, 2010). Hence, the research and development, and ultimately the market introduction, of innovative low-carbon technologies and fuels are crucial for the sector's longterm perspective. In this context, a key question to be answered is whether the sector's research capacities are up to meet this challenge. While the inherent uncertainty in linking R&D efforts with technology improvement makes it difficult to postulate the future level of research needed for successfully offering the technological options required, an analysis of the present transport research capacities is a first step towards answering this question. To this end, the present report analyses the volume and direction of present research efforts of both industry and public players, supplemented by an analysis of patent applications. This quantitative snapshot is complemented by the qualitative assessment of the innovation system transport (ISyT), which goes beyond the narrow focus of R&D but sketches out the interlinkages between major R&D players, instruments, functions etc. that are relevant for innovation in the transport sector. To this end the report sketches out and starts the full analysis of the Innovation System of Transport (ISyT), concentrating the analysis on a modal scope, but providing the recommendation to extend the analysis by three integrative analyses: logistics technologies, passenger and freight transport. Concerning the quantitative snapshot it should be pointed out that officially available data do not allow for a comprehensive assessment of R&D efforts in the transport sector; data become even worse when trying to estimate the parts of the total research investments dedicated to a single technology or a group of technologies. Hence, an assumption-based bottom-up analysis has been applied in order to nevertheless derive some results at the EU-level for industrial and public research efforts. This approach combines information on companies total R&D investments taken from the companies annual report, as collected and processed in the EU Industrial R&D Investment Scoreboard, with a number of other pieces of information that can be used as an indication of
1 See e.g. the recent TERM report that estimates that measures to 'improve' technologies in transport will play a major role in reducing the GHG emissions of transport, even though also other measures are needed (EEA, 2010).
2
GHG-TransPoRD D1
the allocation of total research investment in various technologies. This approach implies that the results are associated with elevated uncertainties and therefore provide a rough indication only. Moreover, as the analysis of industrial R&D efforts concentrates on a limited number of actors (yet, the main ones), the actual figures may be higher. Similarly, lack of data for some EU Member States and the fact that the figures obtained for public R&D investments often do not include neither regional funds nor institutional budgets mean that the results tend to be an underestimation. Finally, the focus of the assessment on the latest year for which most data has been available at the time of preparation of the report – 2008 – implies that the recent dynamics in transport related research, much of which triggered by the economic downturn, have not been fully reflected; also the recent additional public support to the sector ('s R&D) is therefore not fully included. In order to nevertheless provide some outlook of more recent trends, 2009 figures for corporate R&D investments in road transport, are also included. Despite the above limitations, a comparison of results with other scattered pieces of information confirms the findings of the present report. As important as the confirmation with other studies is the fact that the three different approaches combined in this report – i.e. the quantitative assessment of R&D investments; the analysis of patents; and the qualitative description of the innovation system transport – come to similar conclusions where comparable. This allows drawing some policy-relevant conclusions despite the limitations in the underlying data. 1. The transport sector is the largest industrial R&D investor in the EU with an investment volume of around €40 billion in 2008. Herewithin, research efforts of the automotive industry are clearly dominating, followed by those of the aviation sector. R&D investments of the automotive sector have been further disaggregated into road passenger and road freight transport and supplier components. We find significantly higher levels of R&D investment volumes and a higher R&D intensity of car manufacturers compared to manufacturers of commercial vehicles. This can be explained by the very distinct nature of road passenger and road freight transport. In road freight transport, the high competition and the consequently high price pressures means that transport companies focus largely on reducing their costs. Given the significant share of fuel costs out of the total operating cost for commercial vehicles, the fuel efficiency of new trucks is an important purchase criterion. Nevertheless, transport companies will follow a strict economic calculus when buying new equipment and are not ready to pay for 'innovative technologies' as such. This situation is different in passenger cars, where consumers' choice is influenced by a variety of factors. Cars are more exposed to a 'differentiation and branding pressure', and innovative technologies can be one selling factor.
Transport R&D Capacities in the EU
3
R&D investments in rail and maritime are more limited, comparing the absolute values with road and air. However, when setting the R&D investments in relation to the net sales of the sectors – i.e. the R&D intensity – this heterogeneity becomes less pronounced. In 2008, R&D intensities in the road sector are around 5% (passenger cars: 5.1% and commercial vehicles: 3.6%), while aviation (civil aeronautics) shows significantly higher (7.6%) and rail (4.3%) and maritime (3.4%) slightly lower values. EU-based transport companies hold a large share in global transport-related R&D investment, followed by companies with headquarters in Japan and the USA. Considering the truly global nature of the transport industry with most of its players acting at world level, however, this geographical allocation is of limited significance. 2. Industrial R&D investments are highly concentrated in a few main players, with 12 companies2 accounting for 80% of the total transport-related R&D investments. This can be explained by the market structure of the transport industry, which is mainly oligopolistic competition, and the fact that most of the technological development comes from inside the industry rather than being purchased (as is the case e.g. in the energy sector). However, this picture changes for alternative fuels and new technologies other than conventional internal combustion engines. Here, specialised niche providers have entered the market as well as major industries from nontransport sectors such as electric utilities. Often, new coalitions between established car manufacturers and component suppliers and these newcomers emerge, leading to a relatively rapid sharing of the new knowledge and therefore accelerating innovation within the sector in a vertical way ('supplier path'). At the same time, however, the high competition between the major car manufacturers means that horizontal knowledge exchange is limited to those areas where car manufacturers consider collaboration advantageous, such as collaborative research projects under the EU research framework programmes. In aviation, the particular situation of close links between military and civil developments creates an important knowledge transfer, which is very pronounced in this sector. 3. The role of public R&D investments (both from Member States and EU FP7 funds) is very heterogeneous between the different transport modes. While it is comparably low in the automotive sector (2.5% of the total) as a whole, which is also due to the fact that the total investments of this sector are by far the largest of all modes, its role is much more pronounced in other modes. Public funds account for 17% for aviation, 23% for rail and 35% for maritime. Each mode has particular circums2 Note that the analysis is undertaken at the level of parent company, not on individual brands. A list of parent companies and related brands and divisions can be found in annex 1.
4
GHG-TransPoRD D1
tances that account for this. Aviation is heavily dependent on public R&D and procurement spending for military purposes. The rail industry still has a considerable degree of public ownership of railway systems and operations (e.g. SNCF and Deutsche Bahn). The maritime sector in the EU is limited to mainly specialist products and military production. Military procurement, as with aviation, leads to a high level of public R&D for initially military applications. 4. All modes dedicate an important part of their R&D efforts to technologies that reduce emissions of GHG3, taking into account investments both from industrial and public funders (see Table 0-1). For the road sector, this part has been estimated to be around one third (increasing to more than 40% if including also technologies to reduce the emissions of air pollutants). It is also around one third in aviation, but this figure may include some R&D focusing on other environmental issues, such as reduction of noise or air pollutant emissions. For rail, the part is more limited (20%), whereas it is higher for maritime transport (48%). A crucial factor in guiding industrial research into the development of environmental technologies has been public policies via the setting of standards and/or the creation of incentives to foster no- or low-carbon vehicles. These policies are not only a driver for R&D but also create a market demand for innovative products, ensuring companies that their development pays off. Yet, these policies cannot be seen as taken unilaterally by governments; on the contrary, the non-negligible influence of the transport industry on policy making suggests that they are more consensual. Moreover, there are co-benefits for investing in R&D on technologies that reduce GHG emissions such as reduced fuel consumption and thus improved energy security with respect to reducing fossil fuel dependence, which may have been another important driver for allocating efforts to the technologies. 5. For the automotive sector, a further breakdown of research efforts into three technology groups has been performed. From this it becomes obvious that within the GHG emission reduction R&D efforts, and herewithin focusing on engine technologies, the largest focus of industrial research lies on the optimisation of conventional internal combustion engines. Electric vehicles (including hybrids) are the most relevant field of developing non-conventional engine technologies. This is strongly supported by evidence from an analysis of patent applications, which also hint at the rapid increase in the importance given to this technology in recent years. Fuel cell 3 Note that technologies that can reduce GHG emissions are not necessarily being developed for this purpose only but by other than environmental considerations, e.g. to increase the 'joy of driving', and may be (partly) outweighed by more performant cars etc. They are nevertheless allocated to 'GHG emission reduction' for the purpose of the present assessment.
Transport R&D Capacities in the EU
5
vehicles and biofuels show comparably lower industrial R&D investment. Unlike for electric vehicles with strong dynamics, the patent search indicates for fuel cell technologies a stagnating trend in later years. This can be interpreted as these technologies loosing relative importance compared to booming electric vehicles, meaning that there is a possibility of lock-in to electric vehicles, considering also that the major firms or technology alliances are now concentrating on electric vehicles. Nevertheless, there are also synergies between the development of battery electric and fuel cell (electric) vehicles. 6. Public R&D funds follow more or less opposite trends, hence complementing the industrial research efforts. Within the above technologies, they are most elevated for fuel cells, and more limited in the case of EV and conventional engines. This becomes even more pronounced when looking into the relative contribution of public funds: they rise from a mere 2.5% for conventional engines to some 30% for biofuels and 36% for fuel cells. This finding is well supported by innovation theory. In general, technologies that are close-to-market and thus require expensive pilot plants and up-scaling would face larger industrial contribution, while technologies that are further from market are mainly publicly financed as industry would not want to take the risk. Having in mind that hydrogen-fuelled fuel cell vehicles (FCV) are both not likely to enter the market in large quantities soon and have been researched more intense in the first years of the last decade already, the limited corporate R&D investments dedicated to them in 2008 do not come as a surprise. Nevertheless, FCV are seen as a strategic long term option also over battery vehicles for longer range vehicles (see Thomas, 2009; Campanari et al., 2009; Offer et al., 2010), which explains that industry also keeps investing in them, but with a lower urgency. 7. The economic downturn has largely affected the transport sector in 2009. Net sales of EU-based manufacturers of passenger cars have decreased by around 10% compared to 2008, and by around 33% for manufacturers of commercial vehicles. Also R&D investments have decreased, but at a considerably slower pace than the turnover. Compared to 2008, R&D investments fell by some 11% for passenger car manufacturers and ca. 7% for truck manufacturers. This implies a constant R&D intensity for passenger car manufacturers and an increase for road freight vehicle manufacturers. At the same time, there are indications of R&D investments getting more focused on technologies with a shorter expected return on investment. This may imply a further focus on e.g. electric vehicles at the detriment of fuel cell vehicles. Also the importance of research dedicated towards 'green technologies' seems to increase according to scattered pieces of information available.
6
GHG-TransPoRD D1
To some extent these findings may indicate that companies consider investments in R&D as a strategy for overcoming the times of crisis being well positioned compared to their competitors in the expected uptake after the crisis. Experience from the effect of liberalisation on R&D in the energy sector also suggests that a higher price pressure favours incremental innovations with lower risks, which would confirm our findings. One nevertheless needs to take into account that a one-year change can also be influenced by a number of other factors, such as inertia in adapting R&D budgets on a short term, and should therefore not be over-interpreted.
All in all, the analysis finds that EU-based transport-related companies are the largest R&D investors of the European society. Significant parts of their R&D investments are dedicated to the reduction of GHG emissions throughout all modes, often influenced by policies that provided regulations which directly or indirectly steered the direction of industrial research. Public research complements industrial research – it is more pronounced in aviation, rail and maritime than in road transport; within road transport it concentrates on technologies that are promising long-term options, but which receive less industrial attention given their comparably lower level of maturity. With the growing importance of non-conventional technologies and fuels, a number of niche providers enter the market, which otherwise is largely dominated by very few players. Their knowledge is often spread rapidly in a vertical way through coalitions between newcomers and established manufacturers, while knowledge diffusion among competing manufacturers of e.g. cars remains limited. From this snapshot we conclude that the European transport sector is prepared to develop the low-carbon options that can bring it in line with the EU climate change strategy, but may require a further reliable framework to guide its investments (even more) into this direction. Public R&D funds can help to avoid a lock-in effect into short/medium-term options by supplementing corporate research efforts in areas that are a lower priority for industry as they would bear fruits only on the longer-term horizons.
Transport R&D Capacities in the EU
Table 0-1:
7
Summary of results – Approximates for the year 2008
Category/segment Road ICB - Automotive manufacturers ICB - Automotive suppliers ICB - Commercial vehicles and trucks ICB - Automotive industry Air ICB - Aerospace and defence Total transport ICB – Transport Eurostat BERD (BES funds)
Estimated corporate R&D R&D investTurnover R&D ment (€bn) (€bn) intensity WORLD 53 19.6 6.9 79.5
1213 437 233 1883
4.4% 4.5% 3% 4.2%
15.6
379
4.1%
95.1 71
2262
4.2%
Est. public R&D Public MS EU FP7 (€bn) (€bn)
Total R&D (€bn)
EU-27 Road ICB - Automotive manufacturers ICB - Automotive suppliers ICB - Commercial vehicles and trucks ICB - Automotive industry Automotive manufacturers Passenger cars Commercial vehicles (trucks, buses) Automotive suppliers Automotive sector Eurostat BERD (BES) - Manufacture of motor vehicles, trailers and semi-trailers
20.9 9.5 2.4 32.8 21.7 17.9 3.8 9.3 31
7.5 4.8 ~1.5
Eurostat BERD (BES) – Manufacture of
~13.4 ~10-11 ~7.9 ~2.6 ~5-6 ~1.3-1.6 ~0.3-0.4 ~0.27
4.4
GBAORD NABS 07 051 – Aerospace equip. manufacturing and repairing Rail Rail total R&D – GHG emissions reduction
0.85 ~0.17
Eurostat BERD (BES) – Manufacture of
0.4
railway, tramway locomotives, rolling stock
0.65
0.15
31.8
~0.21
~0.06
~10.3-11.3
~0.08-0.12 ~0.06-0.1 ~0.14 ~0.07
~0.02 ~0.07 ~0.06
~5.1-6.1 ~1.4-1.7 ~0.5-0.6 ~0.4
129 62.5
5.8% 7.6%
0.6 ~0.25
0.4 ~0.16
5.7 ~1.9
0.4
Maritime Maritime total R&D – GHG emissions reduction
0.57 ~0.3
Eurostat BERD (BES) – Building and
0.2
repairing of ships and boats
4.9% 6.1% 3.6% 5.1% 4.8% 5.1% 3.6% 6.7% 5.2%
21.4
R&D – Environmental technologies R&D – GHG emissions reduction - Automotive manufacturers - Automotive suppliers R&D - Conventional ICEs R&D - Electric vehicles R&D - Fuel cells R&D – Biofuels Air ICB- Aerospace and defence Civil aeronautics R&D – GHG emissions reduction aircraft and spacecraft
423 156 66 645 455 349 107 138 594
All modes ICB – Transport Total transport R&D – GHG emissions reduction
40.3 37.2 ~12-13
Eurostat BERD (BES funds)
26.7
19.8
4.3%
0.24 ~0.05
0.02 ~0.005
1.1 ~0.22
16.5
3.4%
0.26 ~0.1
0.05 ~0.02
0.9 ~0.4
774 693
5.2% 5.4%
1.8 ~0.6
0.6 ~0.25
39.5 ~13-14
Rounded numbers Note: Estimates from our bottom-up analysis are highlighted in grey; Note that the figures stemming from the different databases (EU Scoreboard, Eurostat BERD, GBAORD) are not comparable due to methodological differences (sectoral definition, allocation method, etc.). ICB = Industry Classification Benchmark
8
GHG-TransPoRD D1
Introduction The European Union is committed to reduce its greenhouse gas emissions by at least 20% by the year 2020 compared to 1990 levels in order to fight global climate change. In the long run, there is an agreement that developed countries will need to bring down their emission levels by some 60-80% compared to the same base year. While over the past decade most sectors managed to reduce their emission levels, transport emissions experienced a continuous rise. The transport sector will therefore need to undergo significant changes in order to become more sustainable and to not endanger the fulfilment of the European climate and energy objectives. Technological changes are expected to play a pivotal role in reducing the environmental impacts of transport (EEA, 2010). A broad portfolio of technological options to reduce GHG emission in all transport modes are currently being researched, developed or already implemented. Their techno-economic characteristics and the GHG emission reduction potentials are further discussed in WP2 and WP3 of the GHG-TransPoRD project. On that basis, scenarios will be developed that hint at the areas in which additional policies and measures are most needed in order to fully exploit the reduction potentials, also pointing out priority research fields in transport. As a starting point for the analysis of additional research efforts, current R&D capacities in the transport sector need to be known. This report therefore aims at estimating the most recent R&D investments in the EU by industry and public funds from Member States and at the EU level. This assessment is complemented by an analysis of patent applications, which provide additional information such as the dynamics of various research fields over time. At the same time, it sketches out the innovation system transport by assessing the main (institutional) actors being involved in R&D and trying to identify links between them. The report is structured as follows: It starts with the executive summary and the conclusions that can be drawn from the various approaches combined in this work. The report's first part then focuses on quantitative assessment of today's investment in R&D efforts and the patent analysis. Each of the sections is wrapped up with a brief summary of key messages. The second part then provides an overview of the innovation systems in low-carbon cars, aviation, railways and maritime. Additional, detailed information on e.g. the key actors in R&D at the European scene or in various EU Member States are placed in the annexes, which also contain an overview of environmental innovations of major car manufacturers. This additional material backs the assessment of the innovation system and provides more details on the programmes named in the quantitative assessment, but can also be seen as a stand-alone part.
Transport R&D Capacities in the EU
PART I – Quantitative assessment of present R&D efforts
9
10
GHG-TransPoRD D1
1.
Scope of the quantitative assessment
The objective of this chapter is to estimate the current corporate and public R&D investments that are allocated to reduce the greenhouse gas emissions of the transport sector in the EU. The analysis focuses on the latest year for which (most) data were available in form of annual company reports or figures from supranational databases such as the IEA and Eurostat. This has been 2008 at the time of writing of this report. Even though the main focus lies on providing a 'snapshot' of present R&D investments, in some cases data from earlier years are provided in addition. The breakdown of the analysis follows the transport modes road, rail, air and maritime. To the extent possible, R&D investments are then further broken down by groups of technologies following the idea of decomposition: Total emissions = Activity *
Energy Emissions * Activity Energy
Herein, the factor energy/activity is associated with a group of measures that aim at improving the efficiency of the mode, while the factor emissions/energy largely comprises alternative fuels. The factor activity is outside of the scope of this work. The report will assess the levels of R&D investments at four distinct levels (Figure 1-1): • R&D invested in 'transport': it refers to the total R&D investment from all transport modes. It is a highly aggregated figure for which a rather reliable database is available and that can be compared with several other studies. • R&D invested by transport mode: this second level of assessment requires quantifying the R&D investment flows assigned to the different modes namely road, rail, maritime and air transport. • R&D invested for reducing energy use and GHG emissions: this third level of analysis is much more complex since it requires 1) to set up a methodology for excluding all R&D activities that do not explicitly focus on environmental-related issues (e.g. safety, comfort, infrastructure) and 2) to separate research activities dealing with GHG emissions reduction from those on air pollutant emissions. Except in a few cases, this amount is generally unknown and therefore requires some further assumptions. • R&D invested at technology group level: data is generally not available at this high level of technological detail. Hence, several rough assumptions ('guess-timates') have been made to come up with an indication of the order of magnitude of this figure. This implies that the uncertainty associated with the results increases with the level of detail given. In the present study, R&D investments will be assessed for the automotive sector and distinguishes between three technology groups: conventional
Transport R&D Capacities in the EU
11
engine technologies, electric vehicles (including hybrid technologies) and alternative fuels (biofuels, hydrogen and fuel cells). In addition to the above breakdown, the R&D investments are distinguished by the type of source funds (corporate, public Member States, EU funding). The objective is thus to come up with a proxy of the three matrices shown in Figure 1-1 below.
GHG EMISSIONS = ACTIVITY Χ
ENERGY INTENSITY Χ
Consumer choices = f (distance travelled, driving patterns…)
J/km – Vehicle technologies
CARBON INTENSITY CO2/J – Future transport fuels
1- Total R&D investment in ‘Transport’ 2- R&D investment by transport mode 3- R&D investment for reducing the environmental impact 3a- GHG emissions reduction 3b- Air pollutants 4- R&D investment per mode, technology and source of funds T1
T2
T3
T4
,,,
Tj
,,,
Tn
ROAD T1 RAIL
Technologies Transport modes
ROAD
AIR
T1 RAIL
T2 T3 MARINE
ROAD
AIR
RAIL
MARINE
T2
T3
T4
T4
,,,
Tj
,,,
,,,
Tj
,,,
Tn
Tn
EU funding
Member States
AIR
MARINE
Corporate R&D
Figure 1-1: Schematic illustration of the approach for the present study
12
GHG-TransPoRD D1
Box 1: Terminology used in the present study R&D investments To the extent possible, the definition of R&D follows the Frascati Manual (OECD, 2002). Companies are hold to apply this definition in their reporting within the International Accounting Standard 38 ('Intangible Assets'). The IEA statistics contain some demonstration figures; however, these are in general limited. Regarding the EU public R&D spending, only funds within the 7th Research Framework Programme have been assessed. While these indeed include some support to demonstration activities, their main focus lies on R&D. R&D investments in 'transport' This generic term is somewhat vague since it can include R&D activities in many domains making it difficult to clearly define the boundaries of the 'transport' sector within or across the different modes. Broadly speaking, the present analysis mainly refers to R&D on vehicle technologies (e.g. for improving energy efficiency, reducing pollutant emissions, improving safety, comfort, etc.). To the extent possible, R&D investments related to transport infrastructure will be ignored (although it is very difficult to undertake in most of the cases, especially for public funding) as well as military applications. More specifically, R&D in 'Road' transport is related to research in all road vehicle technologies as a whole e.g. on passenger cars, trucks, two-wheelers, etc. R&D in 'Rail' transport mainly focuses on R&D investment related to rolling stock e.g. trams, metro, regional trains, locomotives, high and very high speed trains. R&D in 'Air' transport is related to research on civil aeronautics, i.e. excluding defence and space-related R&D activities. Finally, R&D in 'Maritime' transport refers to research on all type of ships (cruise, cargo, yachts, etc.) for commercial or recreational purposes (military applications are not considered). R&D investments for 'reducing GHG emissions' Firstly, assessing the share of R&D investments dedicated to reduce the GHG emissions requires removing non-directly related R&D activities i.e. on safety, comfort, infrastructure, communication technologies, etc. Secondly, it is methodologically complex to separate R&D allocated exclusively to 'energy-saving' technologies from R&D towards 'environmentally-friendly' technologies, the latter generally including R&D on fuel consumption reduction but also on air pollutants and noise. The equation is very complex owing to the fact that technologies designed to reduce GHG emissions (climate change) do not systematically lead to environmental improvements and vice versa. For instance, there are many examples showing that decreasing CO2 for an engine can increase NOx emissions; decreasing noise can increase CO2 emissions, decreasing NOx emissions can also increase CO2 emissions, etc. Moreover, such an analysis should be based on a life cycle perspective. Ideally research would identify and develop such technologies that lead to win-win-win situations for climate mitigation, air pollution and noise. Note also that providing a precise definition of 'GHG emissions' is complex. To simplify, if we consider alternative fuels, it refers to GHG emissions over the whole life cycle (WTW). But in a broad sense (e.g. with regard to energy saving technologies), it mainly refers to GHG emissions during the use phase (TTW), which can be directly emitted (CO2 emissions related to the amount of fuel burnt) or indirectly emitted (e.g. HFC-134 emissions due to air conditioning leakages, etc.). Eventually, some research efforts that results in enhanced fuel efficiency or decreased weight etc. may have been motivated by other than environmental considerations, e.g. to increase the 'joy of driving', and may be (partly) outweighed by more performant cars etc. Nevertheless, the technology can save GHG emissions and would thus be allocated to this group for the purpose of the present exercise.
Transport R&D Capacities in the EU
2. 2.1
13
Methodology Methodology for estimating corporate R&D investments
The analysis of corporate R&D investments builds on a bottom-up approach at the level of individual companies. Hence, the most important data input are the companies' financial statements that are published in their annual reports (which are obligatory for companies listed on the stock exchange). This information is collected in the EU Industrial R&D Investment Scoreboard, which is therefore used as the most important single data source. It is prepared from companies' annual audited reports and accounts and collects data on R&D investment for 1000 EU-based and 1000 non-EU based companies that are grouped according to the ICB4 classification. Companies are allocated to the country of their registered office, which may differ from the operational or R&D headquarters in some cases. In order to complement and validate this company-based approach at the aggregated level of total transport-related R&D investments, data on sectoral R&D expenditures have been used based on the Eurostat/OECD BERD (Business enterprise sector's R&D expenditure) database. BERD contains data on the business enterprise sector's expenditure in R&D for different socio-economic objectives following the NACE5 classification. Furthermore, the expenditures are given by sources of funds, disaggregated into business enterprise sector (BES), government sector (GOV), higher education sector (HES), private non-profit sector (PNO) and abroad (ABR). We assessed transport-related BERD data for funds from all sources and those funds that stem from the business enterprise sector BES. The latter is more comparable to the central bottom-up approach of this report that looks into the R&D investments that stem from the companies' funds (to the extent that the publicly funded parts can be identified and subtracted). Both databases have been manipulated in order to fill data gaps in the latest available year 2008 with data from previous years where available. This is explained in more detail in the relevant sections. The databases allow for an overview of the R&D investment of transport-related sectors in the EU, by Member States and globally.
4 Industry Classification Benchmark 5 European statistical classification of economic sectors
14
GHG-TransPoRD D1
The data do nevertheless not directly allow a further breakdown of R&D funding into different technologies, and there is currently no single dataset that would allow for such an analysis. For this reason, a bottom-up assumption-based approach has been applied in the present work (based on Wiesenthal et al., 2009), which consists of six steps: Step 0: The identification of key industrial players by mode/technology group and single technology. Key industrial players and innovators in the transport sector and by technology (group) were identified. Identifying them one by one instead of relying on the classification by sector allowed to include also companies from ICB sectors that are not necessarily transport-related, such as energy-related industries that can be important stakeholders (e.g. for alternative fuels) and those that act in the supply chain. In total, around 200 relevant companies have been identified6. Note, however, that since the lists of key companies are not exhaustive, neglecting minor players that might, in sum, provide a far greater R&D commitment, they tend to underestimate the total R&D efforts dedicated to transport technologies. Step 1: The gathering of information on R&D investments of these companies. Secondly, the overall R&D investments in the year 2008 had to be identified for the companies selected. Combining information from various sources allowed for the identification of data on R&D investments for 122 out of the 200 companies. As mentioned above, the EU Industrial R&D Investment Scoreboard proved to be the single most important data source for this step. To the extent possible, gaps in the information of the EU Industrial R&D Investment Scoreboard have been filled through a systematic research of annual reports or other information for those companies that are not listed on the stock exchange and thus are not obliged to publish their financial reports. Step 2: The elimination of R&D dedicated to non-transport related activities. Even though most of the companies identified are exclusively active in the transport sector, a number of large companies also have substantial activities in non-transport sectors. This is the case in particular for large supranational companies such as Bosch, Siemens, Alstom, etc. but also energy/oil companies that
6 Around half of them being energy suppliers and fuel cell companies.
Transport R&D Capacities in the EU
15
are important in the area of alternative fuels. For those players, assumptions had to be made on the parts of their overall R&D activity that are directed towards transport. In a number of cases, this figure can directly be derived from official sources. In other cases, it was approximated by e.g. the turnover of the various branches, thus including some uncertainty to the results. Steps 3-5: The allocation of the R&D investments to transport modes (step 3), GHG emission reduction (step 4), and single technologies (step 5). For companies active in more than one transport mode an allocation of the R&D investments by mode were performed. In a next step, a further breakdown to activities that aim are reducing GHG emissions and those that rather aim at enhancing safety or comfort had to be made. Note that an intermediate 'instrumental' step often had to be performed, focusing on R&D investments into 'environmental technologies', as for this sub-group, more information was available than for 'GHG emission reduction technologies'. In a final step, an even further breakdown of the research efforts to distinct technology groups and individual technologies has been aimed at in the road transport sector. This allocation requires additional information as there is no data available at this level of detail. To this end, companies' annual reports and corporate sustainability reports were systematically analysed for additional information on the breakdown of R&D investments. Moreover, the websites of individual companies and associations were screened for further information, enhanced by free searches that delivered additional information in the form of e.g. presentations and speeches from company key actors or press releases. In the easiest cases, this additional information revealed the allocation of the R&D investment to the different technologies. For most companies, however, the R&D expenditures could be narrowed down to a particular field (e.g. 'GHG emission reduction') with certain accuracy but then needed to be further split between the various technologies based on qualitative information. In that cases, some substantiated "guess-timates" based on expert knowledge had to be performed in order to allocate their R&D investment to single technologies. These "guess-timates" build on a number of indirect indications, such as the number of researchers by field that allowed a rough estimation of the R&D investments by applying an average R&D investment per research employee. An average investment of €120,000 to €160,000 per research employee was found to be a suitable proxy based on information from 67 companies or research centres (Figure 2-2). This range was then used for further estimates, unless
16
GHG-TransPoRD D1
more precise figures could be obtained for the specific company. Other companies announced future R&D investment plans, which were subsequently 'extrapolated' to the 2008 data. In other cases, figures on the net sales of various business units could be identified and helped to narrow down relevant R&D investments.
Number of companies/subsidiairies
40 35 30 25 20 15 10 5 0 [90-120]
[120-160]
[160-200]
>200
R&D investm ent per research em ployee (k€)
Figure 2-2: Distribution of R&D investments per research employee Source: IPTS (based on a variety of information sources)
The use of patents (or patent applications) proved to be one of the most important tools in approximating the R&D investments by technology group. Based on the assumption that patents may reflect a company's research effort, the distribution of patents across the relevant technologies was used as a proxy for the distribution of its R&D expenditures. Linking input indicators such as R&D spending to output indicators (such as patents) entails a number of problems as the transport sector' includes a broad variety of technologies and industries with different characteristics regarding the research intensity needed for a patent and the propensity to patent. As a consequence, the average R&D intensity per patent may differ considerably between technologies. Companies may also decide to classify or label patents in a way that makes it difficult to detect them with the patent search scheme applied here. Despite these general constraints regarding the use of patents, they may nevertheless be used as a rough indicator within the scope of this analysis, taking into account that studies show a strong correlation between the number of patents granted and the R&D investments (Popp, 2005; Kemp and Pearson, 2007)7. In general, there is the consideration that patents are a good indicator of the direction of research and of the 7 Popp (2005) shows that patents are a suitable mean for obtaining R&D activity in highly disaggregated forms.
Transport R&D Capacities in the EU
17
technological competencies of firms (Oltra et al., 2008). Furthermore, with regard to the special sector in question, patents are much more accessible than any information of research efforts by technology, as the automotive industry is the industry which protects the most its innovation with patents8. Certainly, one needs to keep in mind the time delay between R&D inputs and outputs. Investments in research need some years before it materializes in the form of patents or patent applications. Hence, using patent data from the latest available years (2007/2009) as a proxy for the R&D investments in the year 2008 leads to some systematic error. Despite the uncertainties resulting from this procedure, it is still considered a valuable input to the assumption-based allocation process when having in mind that its outcome will not be able to deliver more than an estimation of the order of magnitude. Two distinct patent analyses have been used in the present work: a keywordbased research of the European Patent Office's database Espacenet and a search by category of the PATSTAT database. Combining these two different approaches helps in overcoming the specific shortcomings of each of them. For more information see section 2.4. Not only the patent search, but also its application as a proxy for the R&D investment breakdown follows a two-track approach. Firstly, we determine the share of patents on a certain technology in relation to the overall patents of a company as an indication of their share of research efforts in this technology. Alternatively, we use the relative distribution of patents across the different lowcarbon technologies as an indication for the relation of the R&D efforts among them. This latter approach makes sense in those cases where – from other approaches or literature – the R&D investment in one technology had been determined before with a reasonable degree of uncertainty, stemming e.g. directly from company sources. To the extent possible, several of the above mentioned approaches have been combined for individual companies in order to reduce the uncertainty of the estimates. Nevertheless, the allocation process proves to be the greatest source of uncertainty in the present work. Step 6: The summing up of the individual companies' R&D investments by mode, technology group and single technology. 8 42.5% of firms of the industrial sector 'Motor vehicles' protect their innovation with patents (Oltra et al., 2008).
18
GHG-TransPoRD D1
Sources: Experts, breakdown of a sector’s turnover by company, own research through EU platforms, associations, etc.
0- Identify key EU companies investing in transport R&D
PHASE 0
1- Total R&D expenditure of the company
Sources: EU Industrial R&D Scoreboard; Annual Reports PHASE 1
YES
Are all R&D efforts going to the transport sector?
Allocate 100% of the R&D spending to transport-related activities
NO Sources: Annual reports; financial reports; company website, etc.
Assessing the share of the R&D spending going to transport-related activities
Approaches: Annual sales by division; R&D employees per division. Non-transport R&D activities are removed (e.g. Alstom ‘Power’, Wartsila ‘Power Plants’) PHASE 2
2- Approximate R&D expenditures in transport
YES
Are all R&D efforts going to one transport mode?
Allocate 100% of the R&D spending to the relevant mode
NO Sources: Annual reports; financial reports; company website, additional information from the company (e.g. speeches), etc.
Assessing the share of the R&D spending allocating to each mode
Approaches: Annual sales by transport mode; R&D employees by transport mode PHASE 3
Increase of the uncertainty level 3- Approximate R&D expenditures by mode
YES
Are all R&D efforts aiming at reducing GHG emissions?
Allocate 100% of the R&D spending to GHG emissions reduction
NO
Assessing the share of the R&D spending for reducing GHG emissions
Sources: Direct contacts, annual reports, sustainability reports, company website, additional information from the company (e.g. speeches, plans), information from EU projects, press releases, etc. Approaches: Proxies derived from company’s R&D mapping (list of relevant R&D centres, R&D employees, turnover, etc.) PHASE 4
Feedback Checking consistency
4- Approximate R&D expenditures for reducing GHG emissions
YES
Are all R&D efforts going to one technological field?
Allocate 100% of the R&D spending to the relevant technology
NO
Assessing the share of the R&D spending allocating to each technology
Sources: Direct contacts, annual reports, sustainability reports, company website, additional information from the company (e.g. speeches, plans), information from EU projects and specific studies, etc. Approaches: Proxies derived from company’s R&D mapping (list of relevant R&D centres, R&D employees, turnover, etc.) Patents analysis: Combined several methods (e.g. keyword-based approach, PATSTAT) PHASE 5
5- Approximate R&D expenditures by technology
Figure 2-3: Schematic overview of the methodology
Transport R&D Capacities in the EU
2.2
19
Methodology for estimating public R&D investments of EU Member States
The most straightforward way to collect data on public transport-related R&D investments in Member States would be to rely on figures extracted from available supranational datasets such as the Eurostat GBAORD9 and the IEA RD&D statistics10. Due to significant data gaps, in particular at a higher level of detail (e.g. limited number of MS covered, not all data are available for the year 2008, etc.) information from these two databases has been completed to the extent possible by national information on R&D budgets/expenditures. Alongside our own country-based analysis with respect to national research programmes and budgets, a wide number of data has been taken from works carried out by different EU projects and platforms (section 2.2.3).
2.2.1 GBAORD (Government Budget Appropriations or Outlays on R&D) GBAORD (Government Budget Appropriations or Outlays on R&D) are all appropriations allocated to R&D in central government or federal budgets. It is also recommended that provincial or state government should be included when its contribution is significant, while local government funds should be excluded (OECD, 2002). Data are collected from government R&D funders and maintained by Eurostat and the OECD. GBAORD are broken down into 13 main socio-economic objectives according to the purpose of the R&D programme or project following the NABS (Nomenclature for the Analysis and Comparison of Scientific Programmes and Budgets) classification. The category NABS 07 05 'Manufacture of motor vehicle and other means of transport'11 is the most relevant category for the present report. It covers research into the following subsectors: • NABS 07 051: 'Aerospace equipment manufacturing and repairing' • NABS 07 052: 'Manufacture of motor vehicles and parts (including agricultural tractors)' • NABS 07 053: 'Manufacture of all other transport equipment' Unfortunately, at the time of this study the data provided by the GBAORD presented major limitations in term of geographical coverage (only data for seven Member States 9 Note that the Eurostat GERD (Gross Domestic Expenditure on R&D) database, which contains R&D expenditure by R&D performers, could not be used as its breakdown does not provide the level of detail required for this report. 10 http://www.iea.org/stats/rd.asp 11 NABS 07 05 is part of the socio-economic objectives NABS 07 'Industrial production, and technology'.
20
GHG-TransPoRD D1
are available) and time horizon (up to the year 2007 only). The (incomplete) figures given by the GBAORD are presented in chapter 3.2.
2.2.2 IEA RD&D statistics The International Energy Agency (IEA) hosts a publicly accessible database on energy RD&D budgets from the IEA member countries. Data is collected from government RD&D funders. The latest available data are for the year 2008. Similar to the procedure applied for GBAORD data, some straight forward 'gap filling' process was applied for the IEA data. For entries missing for 2008, the value from the latest available year was applied down to the year 2004; data older than 2004 were not considered. This approach slightly distorts the overall picture, but is nevertheless justified given that the main interest of this report lies on the aggregated EU figures. As only 19 of the 27 EU Member States are IEA members, the database systematically contains no data for the other countries, i.e. for Bulgaria, Cyprus, Estonia, Latvia, Lithuania, Malta, Romania, and Slovenia. Unfortunately, the breakdown of the IEA R&D database does not allow covering all the RD&D efforts of the transport sector at the level of detail required in the present study (e.g. no distinction between each transport mode) and could not be used as a central source of data for this work. However, the RD&D budgets allocated by Member States to different vehicle technologies (see Table 2-2 below) can be of high interest. In the present study, data from the categories I.3 'Transportation' and VI.3 'Energy Storage' are used to have an estimate of the public R&D investments12 in new engines and electric vehicles (including hybrids). Furthermore, public R&D investments on biofuels and hydrogen and fuel cells13 will be derived from the categories V.1 'Total hydrogen' and V.2 'Total Fuel Cells' (following IEA, 2009a). Unlike the GBAORD, the IEA database covers demonstration activities on top of pure research and development activities. 'Demonstration projects' are of large scale, but are not expected to operate on a commercial basis (IEA, 2008a). In practice, however, most IEA member countries do either not provide data on funds directed towards demonstration, or do not display them separately.
12 Note that for the purpose of this report, we consider the IEA data as mainly related to R&D investments. 13 Note that RD&D budgets allocated to 'Transport biofuels' are not systematically provided but are covered under the wider category 'Bioenergy'. Likewise, RD&D budgets going to mobile applications of fuel cells are sometimes missing but only available under the category 'Total fuel cells' i.e. including all fuel cell applications.
Transport R&D Capacities in the EU
Table 2-2:
21
IEA categories related to transport RD&D budgets
IEA category
Description
I.3 Transportation
• analysis and optimisation of energy consumption in the transport sector; • efficiency improvements in light-duty vehicles, heavy-duty vehicles, non-road vehicles • public transport systems; • engine-fuel optimisation; • use of alternative fuels (liquid, gaseous); • fuel additives; • diesel engines; • stirling motors, electric cars, hybrid cars; • other.
III.4.1 Production of transport biofuels including from wastes
• conventional bio-fuels; • cellulosic conversion to alcohol; • biomass gas-to-liquids; • other.
V.1 Total Hydrogen
Total Hydrogen = Hydrogen production + Hydrogen storage + Hydrogen transport and distribution + Other infrastructure and systems R&D
V.2 Total Fuel Cells
Total Fuel Cells = Stationary applications + Mobile applications + Other applications
V.2.2 Mobile applications
mobile applications of fuel cells
VI.3 Energy Storage
• batteries; • super-capacitors; • superconducting magnetic; • water heat storage; • sensible/latent heat storage; • photochemical storage; • kinetic energy storage; • other (excluding fuel cells).
Source: IEA, 2009b
22
GHG-TransPoRD D1
2.2.3 Other information sources Three main types of sources have been consulted to collect information about the national R&D programmes (and annual budget funding when available): ERA-NETs, the documents published by the European Technology Platforms (e.g. Strategic Research Agenda) and the results from EU FP7 projects on related topics. An overall picture of the main European actors and R&D programmes related to the different modes of transport is given in Figure 2-4 below (details can be found below and in chapter 9 in the annex). Broadly speaking, research planning and programmes defined under FP7 through large EU initiatives is the result of long collaborative works between all the different stakeholders (European Commission, Member States, private sector, associations, etc.) in the frame of e.g. the EU technology platforms and ERANETs. Road
ERA-NET ROAD
ERTRAC
ERRAC
Rail
Electrification roadmap
SRA, …
SRA, …
EAGAR
EGCI
TPT-SST
SAFIER
ERRAC ROAD MAP
EMAR2RES
Maritime
MARTEC
WATERBORNE TP
SRA, …
SRA, …
CASMARE
TPT-AAT
AGAPE CREATE
Air
AirTN
ACARE
SRA, …
SRA, …
ERANETs
Figure 2-4:
ETPs
EU initiatives
CSSA
Clean Sky JTI
SESAR JU Key FP7 projects (excl. ERANETs)
Overview of actors and programmes in transport research at EU level (simplified)
Note: EU research programmes related to hydrogen and fuel cells (e.g. HFC JTI) and bioenergy (e.g. EU biofuels TP) are not displayed here.
Transport R&D Capacities in the EU
23
The European Research Area Networks (ERA-NETs) aim at coordinating national and regional research activities of EU Member States. In the field of transport, ERA-Net transport (ENT)14 is the network/platform in charge of national transport research programmes in Europe with the aim of structuring the European Research Area (ERA) for transport. Several studies have been carried out that provide, among others, a mapping of the different R&D actors and national transport research programmes in EU countries. Note that within ENT, research funding cooperation is organised in 19 action groups (such as electric mobility, freight transport, alternative fuels, etc.). In this study, two ERANET projects have been of particular relevance for collecting data on national R&D programmes and funds, namely Air Transport Net (AirTN) for aeronautical research and MARTEC (Maritime Technologies) for the maritime transport (see annex). The European Technology Platforms (ETPs) aim at providing 'a framework for stakeholders, led by industry, to define research and development priorities, timeframes and action plans on a number of strategically important issues where achieving Europe's future growth, competitiveness and sustainability objectives is dependent upon major research and technological advances in the medium to long term'15. In other words, the core activity of an ETP is to bring together private and public stakeholders to develop a medium to long term RD&D strategy and action plan in the field concerned. The main outcome of an ETP is the elaboration of a Strategic Research Agenda (SRA) that identifies the key R&D needs for the next decades in order to achieve the objectives defined in a 'Vision' (2020 or 2030) document. As far as the transport sector is concerned, there are mainly five transport-related ETPs. Four of them concern directly one specific transport mode namely ERTRAC for road, ERRAC for rail, ACARE for air and WATERBORNE-TP for maritime transport, while the other is the technology platform on biofuels (BIOFUEL-TP). They are described in more detail in annex. With regard to FP projects (excluding ERANETs), EAGAR16 (European Assessment of Global Publicly Funded Automotive Research, FP7) has been used as a relevant source of information with regard to the public automotive research activities at EU and Member State level (note that the scope of EAGAR goes beyond EU countries). The objective is to identify the 'national road transport visions and roadmaps, research priorities, supported key topics, technology pathway, as well as the level of investment', in
14 http://www.transport-era.net/ 15 http://cordis.europa.eu/technology-platforms/ 16 http://www.eagar.eu/
24
GHG-TransPoRD D1
order to provide a 'direct comparison of national automotive R&D policies relating to the environment (energy, CO2, pollution, recycling, noise), safety and congestion.' Furthermore, the outcomes of the Transport Research Knowledge Centre (TRKC, FP6 project)17 have been widely used to get a comprehensive overview of transport-related research activities carried out at European and national level in all transport modes. Its web portal provides valuable information and data about the different organisations, research programmes and projects in the transport sector across the European Research Area (ERA). In 2009, the TRKC released an updated review of the different transport research programmes and projects undertaken at EU and national level (TRKC, 2009). The estimates of the public Member States funding through the different transport modes thus result from a combination of all available data (that have been also crosschecked) provided by these EU projects and platforms (see Table 2-3). Table 2-3:
Key sources providing qualitative and quantitative information on national transport R&D activities
Sector
ETPs/Projects
Road
ERTRAC - European Road Transport Research Advisory Council EUCAR - The European Council for Automotive R&D ERA-NET Road EAGAR project (FP7)
Air
AirTN – Air Transport Net ACARE - Advisory Council for Aeronautics Research in Europe Clean Sky JTI SESAR JU
AirTN, 2009
Rail
ERRAC - European Rail Research Advisory Council
ERRAC, 2008
Maritime
WATERBORNE TP - European Technology Platform Waterborne MARTEC ERA-NET – Maritime Technologies
MARTEC, 2007
Biofuels
European Biofuels Technology Platform (Biofuels TP)
H2/FC
European Fuel Cells and Hydrogen JTI
General information
TRKC - Transport Research Knowledge Centre (FP6) ERA-NET Transport NETWATCH (JRC-IPTS) ERAWATCH (JRC IPTS)
17 http://www.transport-research.info/
Key reference
TRKC, 2009
Transport R&D Capacities in the EU
2.3
25
EU FP7 public transport R&D investments
European funds complement the Member States' public R&D support. The Research Framework Programme is a key source of R&D financing on new transport technologies. Launched in 2007, the Seventh Framework Programme (FP7) has a total budget of €50 billion (2007-2013) in support to the Lisbon Strategy. The assessment of the FP7 R&D investments undertaken here relies on a combination of different approaches. To the extent possible, the official budgets – also including the recent European Green Cars Initiative from 2010 onwards – have been used, and then annualised (see below). When going at a higher level of detail, e.g. for obtaining a breakdown of the R&D investments by transport mode or some technologies (biofuels), information on budgets does not provide the required level of detail. In these cases, FP7 commitments during the first two years of its duration to single projects have been analysed. This track of assessment systematically includes all projects funded within of the core budget line used for transport-R&D projects ('Transport' thematic priority); to the extent possible it has been complemented by other transport-relevant projects that are funded through other budget lines (e.g. 'Energy' or 'Environment'). As the EU Research Framework Programmes are of multiannual nature, while the present report aims at presenting the EU R&D investments for the most recent year available, they had to be broken down further in order to determine the specific budgets available for one single year. In order to level out annual fluctuations in the budget that are due to the project cycles, it was decided to assume an even allocation of the total expenses to every year of the FP7 duration (the financially effective duration of FP7 was six years). More concretely, the following approach has been used for assessing the various FP7 R&D support (see Figure 3-16 for a summary): •
For road, the European Green Cars Initiative has been used as one basis, assuming an annual spread of the budget over the period 2007-2013, even though it has been launched at a latter stage only. On top of this, projects launched under TPT-SST that relate to road transport R&D other than EGCI are taken into account.
•
For rail and waterborne as well as multimodal research, an analysis of the projects launched during the first two years has been used as estimate. The same applies to the analysis of biofuels-related R&D.
26
GHG-TransPoRD D1
•
For hydrogen and fuel cells, the budget of FP7 to FCH JTI has been annualised.
•
In the case of aviation, the annualised budget of the Clean Sky JTI and the SESAR Joint Undertaking is taken as a basis. This is complemented by the commitments to aviation-related projects under Collaborative Research TPTAAT.
To the extent possible, the figures obtained here are consistent with official figures at the more aggregated level. Other EU funding schemes such as the Competitiveness and Innovation Programme with its pillar Intelligent Energy Europe, the Cohesion funds, Trans-European Networks, etc. could either not be assessed quantitatively on the level of detail needed for this report, or were considered less relevant for research as they mainly focus on deployment.
2.4
Search of patent applications
Patent statistics, though an imperfect measure, are an established tool in the assessment of the technological capabilities of countries or companies. In order to better understand the current stand of technological development related to reducing greenhouse gas emissions in the transport sector, the patent activity in four selected technology areas is examined (conventional engines; electric vehicles; fuel cell vehicles; biofuels). The outcome is used for two different purposes in the present report. Firstly, it serves as a rough indicator when estimating corporate R&D investments by technology (group). To this end, the share of a company's number of patents on a certain technology in their overall patenting activity is assumed to be related to their share of R&D investments dedicated to this technology in total R&D investments, despite all the drawbacks related with linking R&D investments and patents (see discussion in section 2.1). Secondly, as it has not been possible to assess the R&D investments into certain technologies over time, the results of the patent search are used as an indication of the time dynamics of attention given to certain technologies. The results of this analysis are described in chapter 5. Two different approaches on analysing patent (applications) have been used in parallel so as to overcome the specific shortcomings of each of them. On the one hand, a keyword-based research of the European Patent Office's database Espacenet, on the other a search by category of the PATSTAT database.
Transport R&D Capacities in the EU
27
The (straightforward) keyword-based research builds on literature and follows the methodology developed by Oltra and Saint Jean (2009a). The yearly number of patent applications delivered worldwide to different technologies can be obtained from the patent database hosted by the European Patent Office (EPO)18. The searching process consists of using the three search fields: 'keywords in title or abstract', 'publication date' and 'applicant'. However, this keyword-based approach is subject to several drawbacks, as underlined by Oltra and Saint Jean (2009a). The more in-detail search using the IPC19 method with the October 2009 snapshot of PATSTAT, the Worldwide Patent Statistical Database maintained by the European Patent Office (EPO). We consider here “international patent applications”, defined as those applications filed under the Patent Cooperation Treaty (PCT, “world patents”) and those filed directly at the EPO20. The technologies fields investigated were: 1. Hybrid and electric vehicles: this includes electric motors used for traction in vehicles (i.e. small electric motors included for comfort are excluded), their integration into the vehicle, energy recovery from braking, and the pertinent control structures. 2. Mobile fuel cells: this includes all aspects of fuel-cell manufacture as well as their integration into vehicles. 3. Biofuels: this includes technologies which allow the industrial scale preparation of gaseous or liquid fuels from biomass (all origins). The IPC method has been used successfully in a number of past studies. Nevertheless, a brief look at its strengths and weaknesses is warranted. The principal strength compared to the keyword method lies in the assessment of relevant technology fields, regardless of whether the patents contain the selected keywords or not. Furthermore, this type of search profits from the expertise of the patent offices when assigning each patent to the relevant field of technology. However, the selection on the basis of IPC still cannot guarantee that all relevant patents are captured in the search (false negatives). On the other hand, it is not possible to exclude the possibility of counting patents that are not directly relevant and that for one reason or another are included in the IPC codes deemed as adequate for the search (false positives).
18 http://ep.espacenet.com/ 19 IPC stands for International Patent Classification. It provides a hierarchical system of language independent symbols for the classification of patents and utility models according to the different areas of technology to which they pertain. The search is thus performed by specifying relevant IPC codes. 20 To avoid double counting of patent applications, those patents at the EPO resulting from applications under the PCT are excluded.
28
GHG-TransPoRD D1
In order to minimize the error in the search based on IPC codes, the search strategies are extensively tested by performing limited searches (e.g. to a single year, depending on the absolute number of patents) and examining the titles and abstracts of the patents matched by the search. In general, search strategies are initially designed to be broad and are then trimmed according to the detailed information in the patent applications. In the case that a given IPC code contains significant numbers of false positives, this particular IPC code is constrained by using keywords. Despite these precautions, we are compelled to point to the inherent uncertainties in the results presented in this chapter, which make it impossible to provide absolute numbers of relevant patent applications. Moreover, because the respective margins of error are unknown, it is not possible to apply significance testing (in the statistical sense) to small differences between observations. Despite the difficulties outlined above, it is possible to use the data to identify patenting trends and as an indicator of the technological performance of companies, countries or regions in comparison to each other, as shown in chapter 5.
Transport R&D Capacities in the EU
3.
29
RESULTS I – Overall R&D investments in transport
3.1
Corporate R&D investments
In this section, we assess the overall corporate R&D investment in the transport sector as defined by the ICB (Industry Classification Benchmark). This means that we assess each ICB class as such, using the EU Industrial R&D Investment Scoreboard as a starting point. The objective of this chapter is to provide an overview of the R&D investments allocated to 'transport' as a whole at world and European level. Moreover, it will look into the investments by mode and sub-sectors. In order to make our results comparable with other studies, we will carefully define what the 'transport' sector and various sub-selections refer to where necessary. Eventually, this approach is complemented by relevant figures from the BERD database and compared to the extent possible. Unlike in chapter 4, we do not modify the figures from the scoreboard – i.e. we neither remove the non-transport-related R&D investments of multi-business companies that are allocated to transport-related ICB sectors, nor complement the sectors with other relevant companies that are allocated to non-transport ICB sector. A summary of the main pros and cons associated with this overall assessment is given in Table 3-4 below: Table 3-4:
Pros and Cons of the overall assessment
Pros R&D investments, turnover and number of employees are provided A comparison is possible with other ICB sectors Geographical coverage: World, Europe and Member States level Time series 2002-2008 are available A comparison is possible with other supranational sources
Cons Restricted number of companies Due to ICB classification, not all transport-related firms are included Due to ICB classification, not all the companies included invest 100% of their R&D in transport-related activities Due to ICB classification, no clear distinction between all transport modes is made possible No R&D investments provided at the level of detail required for the present analysis
30
GHG-TransPoRD D1
3.1.1 Overall analysis based on the EU Industrial R&D Investment Scoreboard The EU Industrial R&D Investment Scoreboard is based on the ICB classification. With regard to transport R&D, the most relevant ICB categories are basically 'Automobiles & parts', 'Commercial vehicles & trucks' and 'Aerospace & defence' which are the categories analysed in the present chapter21. For a more thorough analysis, we have split the 'Automobiles & parts' category into the two subsectors 'Automotive manufacturers' and 'Automotive suppliers'22. Hence, the 'transport' sector as defined in this chapter consists of the following subsectors:
• 'Automotive manufacturers' (part of 'Automobiles & parts') • 'Automotive suppliers' (part of 'Automobiles & parts') • 'Commercial vehicles and trucks' • 'Aerospace and defence' In the following, note that the figures provided are the sum of a limited number of companies only. The 'transport sector' as defined here contains 92 EU-based companies and 101 non-EU-based companies. Even though these are the largest R&D investors, the limited number of actors considered means that the actual figure would be even higher.
3.1.1.1
Transport R&D worldwide
Table 3-5 shows the R&D investments, net sales and number of employees in transport-related sectors worldwide for the year 2008. Based on the figures derived from the EU Scoreboard 2009 (DG RTD-IPTS, 2009), it is estimated that the R&D expenditures relative to the transport sector accounted for around €95 billion in 2008 i.e. 22% of the
21 Even if these ICB categories cover a wide number of EU companies active in transport-related research, other ICB categories can include important firms playing a key innovation role into one or several transport modes. It is the case for instance of Alstom (cat. 'Industrial machinery'), Siemens (cat. 'Electric components & equipment') and all energy suppliers (e.g. biofuels, hydrogen, battery producers). 22 Note that in the ICB classification 'Automobiles & parts' is generally divided into 'Automobiles', 'Auto parts' and 'Tires'. In this chapter, tyre manufacturers are assumed to be part of 'Auto parts'. This is mainly motivated by the fact that key companies in 2008 (e.g. Continental) cannot be simply classified as 'tyre manufacturers' since their R&D efforts go well beyond tyre manufacturing.
Transport R&D Capacities in the EU
31
total corporate R&D investment worldwide. It means that this sector represents one of the largest R&D investor worldwide, other important R&D investments come from the 'Pharmaceuticals and Biotechnology' and 'Technology Hardware and Equipment' industries (DG RTD-IPTS, 2009). Table 3-5:
Automotive manufacturers Automotive suppliers Commercial vehicles and trucks Aerospace & defence 'Transport' sector All industries
R&D investments, sales and total number of employees related to the 'Transport' sector (2008) R&D investment (€bn)
Sales (€bn)
World
World
EU27
Number of employees (million) EU27
World
EU27
53
20.9
1,213
423
2.76
1.26
19.6
9.5
437
156
2.33
0.98
6.9
2.4
233
66
0.62
0.22
15.6
7.5
379
129
1.74
0.55
95.1
40.3
2,262
774
7.5
3
431
130
13,897
5,712
45.1
21
Data source: EU Scoreboard 2009 (DG RTD-IPTS, 2009) (rounded numbers)
As depicted in Figure 3-5, this huge R&D effort is mainly driven by the automotive manufacturers which account for 56% of the total R&D investment, followed by the automotive suppliers with 21%. A similar distribution is found when considering the total sales picture, for which the transport sector weights 16% of the total industry turnover in 2008. Regarding the number of employees, 16% of the total employees worked in the 'transport' sector in 2008 (i.e. around €7.5 million). It becomes obvious that the transport industry holds a larger share in the total industrial R&D investments than its share in employees and sales. This is a first indication of a relatively elevated R&D intensity of this sector relative to other sectors.
32
GHG-TransPoRD D1
Commercial vehicles and trucks 7% Aerospace & defence 16% ~ €95bn
Automotive manufacturers 56%
Automotive suppliers 21%
R&D of ‘transport’ = 22% of worldwide corporate R&D
Commercial vehicles and trucks 10% Aerospace & defence 17% ~ €2262bn
Automotive manufacturers 54%
Automotive suppliers 19% Sales of ‘transport’ = 16.3% of worldwide corporate sales
Commercial vehicles and trucks 8% Aerospace & defence 23%
~ 7.5m employees
Automotive manufacturers 38%
Automotive suppliers 31% Nb of employees of ‘transport’ = 16.5% of worldwide corporate employees
Figure 3-5:
Weight of transport-related sectors with regard to R&D investments, sales and number of employees – World level (2008)
Data source: EU Scoreboard 2009 (DG RTD-IPTS, 2009)
Figure 3-6 shows the geographical R&D investments repartition from the transportrelated sectors analysed. Out of the €95 billion invested worldwide in transport in 2008, EU-based industries accounted for around €40 billion (i.e. 42% of the total investment), followed by Japan with €26 billion (28%) and the U.S. with €25 billion (26%). Only 3% of the total R&D investment in transport was realised by other countries.
Transport R&D Capacities in the EU
33
RoW 3%
45 USA 26%
40
EU-27 43%
~ €95bn
R&D investment (€ billion)
35
Commercial vehicles and trucks
30
Japan 28%
Aerospace & defence Automotive suppliers
25
Automotive manufacturers
20
15
10
5
0
EU-27
Figure 3-6:
Japan
USA
RoW
Distribution of R&D investments from transport-related companies worldwide (2008)
Data source: EU Scoreboard 2009 (DG RTD-IPTS, 2009)
Figure 3-7 below shows the evolution of the above-mentioned R&D investments in transport over the period 2002-2008. Even if these investments have globally increased between 2002 and 2007 (note however a slight decrease in 2006), a sharp increase has been observed in 2008 compared to the previous year (around €10 billion more i.e. 11% increase between 2007 and 2008)23. Globally, the R&D intensity of the sector has remained constant with around 5% for EU-based industries and less than 4% for nonEU industries. Moreover, it is worth mentioning that the weight of the EU-based companies relative to the total R&D investment in transport in the world has ranged between 43% (minimum reached in 2008) and 47% (maximum reached in 2006) over the period 2002-2008. Note that this geographical allocation bears some methodological problems as there are various ways of allocated R&D investments of a company to a certain country (see box 3). Moreover, it is questionable whether a geographical breakdown makes much sense, considering the truly global nature of the main industrial players involved in transport-related research.
23 Note that our analysis of 2009 figures (see chapter 4.1.1) indicates that R&D investments have somewhat decreased in 2009 (back to 2007 level approximately for automotive manufacturers) while the R&D intensity has globally increased, depending on the sectors.
34
GHG-TransPoRD D1
100
6.0%
90
R&D investment (€2005 bn)
70
4.0%
60 50
3.0%
40 2.0%
30 20
Non EU-based companies
1.0%
EU-based companies 10
R&D intensity (%)
5.0%
80
R&D intensity (non EU-based companies) R&D intensity (EU-based companies)
0
0.0% 2002
Figure 3-7:
2003
2004
2005
2006
2007
2008
Evolution of R&D investments and R&D intensity from EU and nonEU based transport-related companies over the period 2002-2008
Data source: EU Scoreboard Note: data in real terms €2005
With regard to the four modal subsectors, the main findings are the following: Automotive manufacturers invested €53 billion in R&D in 2008, derived from the assessment of around 30 companies worldwide. Almost 40% (€21 billion) were due to companies with their headquarters in the EU (mainly Germany; France and Italy), 36% from Japan and 21% from US-based firms. It is worth mentioning that at world level, twelve groups namely Toyota, Volkswagen, General Motors, Ford, Honda, Daimler, Nissan, BMW, PSA Peugeot Citroën, Renault, Fiat and Hyundai accounted for 90% of the total R&D investment. In the EU, six car manufacturers accounted for 95% of the total R&D expenses, namely Volkswagen, Daimler, BMW, PSA, Renault and Fiat. Over the period 2002-2008, the R&D expenditures of this sector worldwide have significantly increased from €42 billion in 2002 to €53 billion in 2008 (26% increase). Since 2002, EU-based companies have always accounted for an important share of the R&D investment, between 38% (in 2002) and 43% (maximum reached in 2007) of the total. Note that the overall R&D intensity of EU-based automotive manufacturers has significantly grown between 2007 and 2008 to reach around 5% in 2008, while non-EU companies present a rather constant R&D intensity over the same period.
35
60
6.0%
50
5.0%
40
4.0%
30
3.0%
20
2.0%
Non EU-based companies
10
R&D intensity (%)
R&D investment (€2005 bn)
Transport R&D Capacities in the EU
1.0%
EU-based companies R&D intensity (non EU-based companies) R&D intensity (EU-based companies)
0
0.0% 2002
Figure 3-8:
2003
2004
2005
2006
2007
2008
Evolution of R&D investments and R&D intensity from EU and nonEU based automotive manufacturers over the period 2002-2008
Data source: EU Scoreboard Note: data in real terms €2005
Box 2: R&D investments in two-wheelers As a rough estimate, around €1.5-2 billion out of the €53 billion was spent in R&D activities on twowheelers in 2008. This estimate results from the analysis of a dozen companies worldwide, the vast majority of them belonging to Japanese manufacturers (e.g. Honda, Yamaha, Kawasaki and Suzuki). The aggregated level of R&D investment from EU-based companies (e.g. BMW Motorcycles, Peugeot Scooters, IMMSI, KTM, Ducati Motor) was found to be at least €250 million in 2008. Even if the contribution of two-wheelers to the GHG emissions of the road transport is quite marginal (see e.g. ACEM, 2010), important research efforts are being undertaken in key areas such as hybrid and electric technologies, fuel cells, biofuels, etc. with the aim to reduce the energy consumption, pollutant emissions and noise. For instance, the R&D intensity of the KTM company has reached some 7.6% in 2008, with around 245 employees working in R&D. As an example of innovation, KTM has recently developed two prototypes of 100% electric off-road and on-road bikes that have been presented at the Tokyo motorcycle show in 201024 (to be commercialised in 2011).
In 2008, worldwide automotive suppliers invested almost €20 billion, stemming from the R&D efforts of more than 80 companies (as listed in the EU Scoreboard). At world level, the largest investors in 2008 were Robert Bosch, Denso, Continental, Delphi, Aisin Selki, Valeo, Bridgestone, ZF, Michelin, Hella, Visteon, Johnson Controls, etc. In Europe, Robert Bosch, Continental, Valeo, ZF, Michelin and Hella are key actors, with Robert Bosch accounting for 41% of the total EU R&D investment in 2008.
24 See KTM press release of 26/03/2010, available at http://www.ktm.com/
36
GHG-TransPoRD D1
Over the period 2002-2008, the R&D investments of the sector have been steadily increasing with a sharp increase between 2007 and 200825. The R&D intensity of European automotive suppliers has remained in the order of 5.5-6%, well above the R&D intensity of non-EU companies. The share of EU-based suppliers out of the total R&D investment has ranged from 43% (minimum in 2004) to 53% (maximum in 2007) and reached 49% in 2008. 20
7.0%
18 6.0%
5.0%
14 12
4.0%
10 3.0%
8 6
R&D intensity (%)
R&D investment (€2005 bn)
16
2.0%
4
Non EU-based companies 1.0%
EU-based companies 2
R&D intensity (non EU-based companies) R&D intensity (EU-based companies)
0
0.0% 2002
Figure 3-9:
2003
2004
2005
2006
2007
2008
Evolution of R&D investments and R&D intensity from EU and nonEU based automotive suppliers over the period 2002-2008
Data source: EU Scoreboard Note: data in real terms €2005
The ICB category 'Commercial vehicles and trucks' showed a total R&D investment of around €7 billion in 2008, calculated from the R&D expenditures of 32 firms worldwide amongst which Volvo, Caterpillar, Deere, Isuzu Motors, MAN and Komatso were the largest investors in 2008. In Europe, Volvo, MAN, Wartsila and Claas accounted for 90% of the total R&D spending for the same year.
25 This can be partly explained by the almost doubling of Continental's R&D expenditures in 2008 due to the purchase of Siemens VDO.
Transport R&D Capacities in the EU
37
During the period 2002-2008, the total R&D investment of this sector has more than doubled (e.g. 80% increase in R&D expenditures from Volvo). Between 35% (in 2008) and 41% (in 2006) of the total R&D investments was due to EU-based companies with an overall R&D intensity ranging between 3.5% and 4%, on average.
7
4.5% 4.0%
6
3.0% 4
2.5% 2.0%
3
1.5%
R&D intensity (%)
R&D investment (€2005 bn)
3.5% 5
2 1.0%
Non EU-based companies 1
EU-based companies R&D intensity (non EU-based companies)
0.5%
R&D intensity (EU-based companies) 0
0.0% 2002
Figure 3-10:
2003
2004
2005
2006
2007
2008
Evolution of R&D investments and R&D intensity from EU and nonEU based industry of the 'Commercial vehicles and trucks' category over the period 2002-2008
Data source: EU Scoreboard Note: data in real terms €2005
The 'Aerospace and defence' sector spent €15.6 billion in R&D in 2008, based on the assessment of 53 world firms whose 8 of them accounted for more than 70% of the total R&D investment (EADS, Boeing, Finmeccanica, United Technologies, Lockheed Martin, Safran, Thales and Rolls-Royce). In 2008 in Europe, 82% of the R&D investment was due to EADS, Finmeccanica, SAFRAN, Thales and Rolls-Royce. During the period 2002-2008, the R&D investments have globally increased except for the last three years for which it has remained somewhat constant. Between 48% (in 2008) and 60% (in 2004) of the total R&D investments was due to EU-based companies with an overall R&D intensity that has significantly decreased from 2004 to reach 6% in 2008 (but still 3% above non-EU companies).
18
9.0%
16
8.0%
14
7.0%
12
6.0%
10
5.0%
8
4.0%
6
3.0%
4
2.0%
Non EU-based companies EU-based companies
2
R&D intensity (%)
GHG-TransPoRD D1
R&D investment (€2005 bn)
38
R&D intensity (non EU-based companies)
1.0%
R&D intensity (EU-based companies) 0
0.0% 2002
Figure 3-11:
2003
2004
2005
2006
2007
2008
Evolution of R&D investments and R&D intensity from EU and nonEU based industry of the 'Aerospace and defence' category over the period 2002-2008
Data source: EU Scoreboard Note: data in real terms €2005
3.1.1.2
Transport R&D in Europe
As seen before, the companies with their headquarters in the EU spent more than €40 billion out of the €95 billion invested worldwide in transport R&D activities. However, it is worth mentioning that this €40 billion of investment represents 31% of the total corporate R&D of the EU, meaning that the weight of 'transport' in Europe is much above its weight estimated at world level (22%). Figure 3-12 displays the R&D breakdown for each transport subsector in the EU27. As expected, three quarters of the R&D investment stemmed from the ICB category 'Automobiles & parts' where car manufacturers accounted for more than half of the total (51%), followed by automotive suppliers (24%), aerospace & defence (19%) and commercial vehicles and trucks (6%). For both the net sales and number of employees, the 'transport' sector in the EU accounts for around 14% of the total. The observation of the higher share in R&D investments than in sales or employees made at the global level becomes even more obvious for EU-based companies. This suggests on the one hand that transport has an elevated R&D intensity, which seems to apply in particular for EU-based companies.
Transport R&D Capacities in the EU
39
Commercial vehicles and trucks 6% Aerospace & defence 19%
~ €40bn Automotive manufacturers 51%
Automotive suppliers 24%
R&D of ‘transport’ = 31% of EU corporate R&D
Commercial vehicles and trucks 9% Aerospace & defence 17% ~ €775bn
Automotive manufacturers 54%
Automotive suppliers 20%
Sales of ‘transport’ = 13.6% of EU corporate sales
Commercial vehicles and trucks 7% Aerospace & defence 18% ~ 3m employees
Automotive manufacturers 42%
Automotive suppliers 33% Nb of employees of ‘transport’ = 14.4% of EU corporate employees
Figure 3-12:
Weight of the 'transport' sector on R&D investments, sales and number of employees – EU27
Data source: EU Scoreboard 2009 (DG RTD-IPTS, 2009)
The database underlying the above figures indicates that much of transport-related research is financed by a rather limited number of companies. This has been further analysed as it provides an important piece of information when considering the innovation system transport later-on. Furthermore, it will allow concentrating on a manageable number of companies in the further assumption based on the breakdown of R&D investments by technology in chapter 4. Figure 3-13 below displays the cumulative R&D investments realised by the 92 EU companies that are part of the 'transport' sector category as defined earlier. It appears that only twelve EU companies accounted for 80% of the total of R&D investment related to the transport sector for the year 2008.
40
GHG-TransPoRD D1
When expanding this list to about 28 companies, it would cover 95% of the total transport R&D investment of EU-based companies. It should be noted that around 56% of the total R&D investment stemmed from German-based companies (e.g. Volkswagen, Daimler, Bosch, BMW, Continental), followed by French (19%) and Italian-based industries (10%). 100%
Share in total R&D investment
90% 80% Volkswagen Daimler Robert Bosch BMW Group EADS PSA Peugeot Citroen Renault Fiat Finmeccanica Continental Volvo Porsche
70% 60% 50% 40% 30% 20% 10% 0% 0
10
20
30
40
50
60
70
80
90
100
Number of companies
Figure 3-13:
Cumulated corporate R&D expenditures from EU-based companies investing in transport R&D (2008)
Data source: EU Scoreboard 2009 (DG RTD-IPTS, 2009) Note: companies refer to parent companies as shown in annex
3.1.1.3
Focus on the EU automotive industry
As defined previously, the so-called 'EU Automotive industry' is made of the ICB categories 'Automobiles & parts' (incl. the subsectors 'Automotive manufacturers' and 'Automotive suppliers') and 'Commercial vehicles and trucks'. The R&D investments, net sales and staff number of this sector for the year 2008 are summarised in Table 3-6 below.
Transport R&D Capacities in the EU
Table 3-6:
Automotive manufacturers Automotive suppliers Commercial vehicles and trucks Automotive industry All industries
41
R&D investments, sales and total number of employees of the EU automotive industry (2008) R&D investment (€bn)
Sales (€bn)
EU27
EU27
Germany
France
20.9
14.1
4.6
423
9.5
7.7
1.4
2.4
0.6
32.8 130
Nb of employees (million)
Germany
France
EU27
Germany
France
270
91
1.26
0.72
0.33
156
109
29
0.98
0.65
0.19
0.04
66
22.2
2.4
0.22
0.07
0.01
22.4
6
645
401
122
2.5
1.44
0.52
45.1
25.7
5,712
1,574
1,122
21
5.9
4.7
Data source: EU Scoreboard 2009 (DG RTD-IPTS, 2009) (rounded numbers)
According to the figures derived from the EU Scoreboard, one can estimate that the R&D investment of the EU automotive industry accounts for one quarter of the total industrial research in the EU, which makes it the largest R&D investor26. Based on the number of companies assessed in the EU Scoreboard, the EU automotive industry spent almost €33 billion in R&D in 2008, 87% of this stemming from industries with their headquarters in Germany and France. Automotive manufacturers represented the highest contributor, mainly due to the high R&D expenditures of German (e.g. Volkswagen, Daimler, BMW) and French manufacturers (PSA Peugeot Citroën, Renault). Robert Bosch, Continental and Valeo are the automotive suppliers which invested the most in 200827. The German car industry invests more than €22 billion in R&D weighting almost half of the total German corporate R&D (far ahead from the chemicals industry with only €5 billion). In France, the car industry is also the largest R&D investor with €6 billion (followed closely by the pharmaceuticals sector with €5 billion), which corresponds to almost one quarter of the total R&D spent by the French industries in 2008. With regard to the category 'commercial vehicles and trucks', Volvo (Sweden) is by far the largest EU investor accounting for 62% of the total R&D investment of this segment in 2008.
26 Note that at world level, the 'Pharmaceuticals & Biotechnology' sector is the top R&D investor (18.9%), followed by the 'Technology Hardware & Equipment' sector (17.4%) and the 'Automobile & Parts' sector with 17.1% (but excluding 'commercial vehicles and trucks', DG RTD-IPTS, 2009). 27 Note that R&D expenses of Faurecia and Magneti Marelli (major automotive suppliers, part of the PSA Group and Fiat Group respectively) are included within the 'Automotive manufacturers' category.
42
GHG-TransPoRD D1
35 Commercial vehicles & trucks 7%
R&D investment (€ billion)
30
25
Automotive suppliers 29%
Automotive manufacturers 64%
~ €32.8 billion
20
15 Other MS 10
France Germany
5
0 Automotive manufacturers
Figure 3-14:
Automotive suppliers Commercial vehicles & trucks
Automotive industry
R&D investment of the EU automotive industry in 2008
Source: based on the EU Scoreboard 2009 (DG RTD-IPTS, 2009)
Several European organisations have reported similar figures for the automotive sector. For instance, the European Road Transport Research Advisory Council (ERTRAC) reported that 'The European road transport industry spends over 30 billion on research and development (R&D) every year' (ERTRAC, 2009). Also, the German Association of the Automotive Industry (VDA) stated that 'With a total investment volume of almost 19 bn Euro, the German automotive industry invested more in research and technology in 2008 than any other branch of industry. The automotive industry therefore accounts for one third of the R&D expenditure of German industry' (VDA, 2009)28. The European Automobile Manufacturers' Association (ACEA) reported that 'the €20bn29 or so spent every year on R&D is a measure of the European automobile industry’s commitment to competitiveness, innovation, employment and social responsibility. The investment amounts to 4% of the industry’s annual turnover, and covers around one fifth of Europe’s total private R&D expenditure' (ACEA, 2009). The same figures were also reported by the European Council for Automotive R&D (EUCAR) stating that the European vehicle manufacturers is the largest private investor in R&D in
28 The VDA website lately reported €20.042 billion of R&D expenditures for the German Automotive industry: http://www.vda.de/en/zahlen/jahreszahlen/allgemeines 29 Figure based on the ACEA members i.e. including automotive manufacturers with headquarters outside the EU.
Transport R&D Capacities in the EU
43
Europe, investing around €20 billion each year, or 4% of their turnover (EUCAR, 2009, 2008). More recently, both the ACEA and EUCAR quoted that 'the fifteen ACEA members together spend over €26 billion every year on R&D, or about 5% of their turnover'30. Considering that this figure includes additional R&D investments from non-EU based companies, this is well in line with the results found in the present study. Furthermore, the European Association of Automotive Suppliers (CLEPA) reported that automotive suppliers in Europe present an annual R&D spending of €12 billion (CLEPA, 2010), which is also in the same order of magnitude of the present analysis (taking into account that not all EU automotive suppliers are included in the EU Scoreboard).
3.1.2 BERD (Business enterprise sector's R&D expenditures) As mentioned earlier, the BERD database is used to complement the bottom-up analysis based on the EU Scoreboard figures. Note however, that as mentioned before and illustrated further in box 3 and section 3.1.3, fundamental differences (e.g. in the geographical allocation) make it difficult to directly compare the two databases. Table 3-7 shows the sectors that are considered as relevant in the context of transportrelated R&D as assessed in this report31. In the present assessment, the 'transport' sector will be defined as the sum of the categories NACE 34 'Manufacture of motor vehicles, trailers and semi-trailers' and NACE 35 'Manufacture of other transport equipment', which cover most of the EU corporate R&D efforts of this sector. Overall, the R&D expenditures allocated to 'Transport' accounted for more than 20% of the total EU27 business and Enterprise R&D expenditures in 2008, regardless the source of funds (total BERD or BES funds only). Even if we cannot directly compare these figures with those stemming from the EU Scoreboard at EU level, it comes as no surprise that the automotive industry (basically NACE 34) represents the most important R&D investor with almost 80% of the total BES funds allocated to 'transport' R&D.
30 See ACEA website and EUCAR (2010). 31 As for the ICB classification used by the EU Scoreboard, further investments stemming from other NACE sectors can exist. However, one can assume that most of the R&D investment in 'transport' is captured.
44
GHG-TransPoRD D1
Table 3-7:
Business and enterprise R&D expenditures in transport-related fields in 2008 aggregated for EU Member States
Sector/subsector
NACE
Funds from all sectors (€m)
Manufacture of motor vehicles, trailers and semi-trailers Manufacture of other transport equipment Building and repairing of ships and boats Manufacture of railway, tramway locomotives, rolling stock Manufacture of aircraft and spacecraft Manufacture of motorcycles and bicycles, other transport equipment n.e.c. Total transport-related R&D Total EU27 Business and Enterprise R&D expenditure Share of transport-related over total BERD
34
22,291
BES funds only (€m) 21,391
35 351 352
10,081 405 493
5,349 214 393
353 354, 355
8,871 182
4,392 160
32,372 151,448
26,740 124,216
21.4%
21.5%
Source: Eurostat BERD database (data retrieved in January 2010) Note: Data gaps for 2008 have been filled with entries from 2003-2007 where necessary: BERD: 2008 data for CZ and SK; 2007 data for AU, EE, FI (NACE 35), FR, DE, HU, NL (NACE 34), PL, PT, RO, SL, ES, UK; 2006 data for DK, IT and NL (NACE 35); 2005 data for GR, IE; 2004 data for LV and LT; 2003 data for BE and SE (NACE 34). No data for LU and no R&D expenditures for BG, CY, MT. BES: No data available for BE, DK, IE, LV, LT, LU, NL and no R&D expenditures for BG, CY and MT. Data for DE and IT have been updated to be consistent with global BERD figures (same years).
3.1.3 Comparison between EU Industrial R&D Investment Scoreboard and BERD Differences in methodologies prevent a direct comparison between the BERD database and the figures provided by the EU Industrial R&D Scoreboard. A deep analysis of the differences between these two data series has been undertaken by Azagra Caro and Grablowitz (2008). Among other things, main differences relate to i) the geographical allocation of R&D investments to either the site of registered office (Scoreboard) or the country in which R&D is being carried out (BERD; see box 3); ii) the sectoral breakdowns used with the Scoreboard following the ICB classification and the BERD database using the NACE breakdown. At the same time it needs to be noted that the EU Scoreboard looks into the R&D investments by EU companies net of any potential contributions from public funds, while BERD focuses on the business and enterprise R&D expenditures independently from the source of the funds.
Transport R&D Capacities in the EU
45
Box 3: Importance of geographical allocation The Scoreboard allocates R&D investments to the site of a company’s headquarter, while the BERD databases refers to R&D activities within a particular sector and territory, regardless of the business headquarters. Indeed, these R&D expenditures are intramural expenditures which are defined as 'all expenditures for R&D performed within a statistical unit or sector of the economy during a specific period, whatever the source of funds' (OECD, 2002). Besides data gaps, this may explain some differences when comparing R&D figures for the NACE classes DM34 and DM35 from the Scoreboard with BERD data for individual countries. Major differences between BERD and Scoreboard data in the transport field are likely to be influenced by the regional allocation. For the Netherlands BERD provides 17 times lower R&D expenditures than the Scoreboard. This can to some extent be explained by EADS, for which the Scoreboard allocates all R&D investments to the Netherlands as it is registered there. The opposite phenomenon can be observed for e.g. Spain, which BERD figures are well above those of the Scoreboard. This becomes understandable by the fact that Spain is an important production country for many brands with headquarters abroad. Furthermore, the important Spanish automotive company Seat is allocated to the Volkswagen AG with headquarters in Germany following the reporting rules. Another counter-intuitive example is Magna-Steyr. Due to Magna Steyr being subsidiary of the Canadian company Magna International, its R&D investments are allocated to Canada instead of Austria.
Despite these fundamental discrepancies, a rough comparison can be undertaken under the following conditions: • Comparison at world level prevents differences in geographical allocations. • Eurostat converted the Scoreboard classification to the NACE classes32. Unfortunately, this has been done only until the year 2005 at the time of this study. Hence, the same allocation has been done by the project team for the latest EU Scoreboard dataset (from 2006 to 2008). Such an exercise has required to carefully manipulating the data, especially with regard to the conversion process from ICB to NACE group. For instance, companies belonging to the 'Tyres' (DH2511) and 'Defence' (L7522) sectors are not part of the NACE 34 and 35 groups and were therefore removed from the EU Scoreboard so that it matches with the NACE classification. • In some cases, there are obvious data gaps in the Eurostat BERD database, which have been filled by the consortium. • Restricting BERD data to those funded by the Business and Enterprise sector BES. The final result of a comparison that follows the above-mentioned preconditions is presented in Table 3-8. Although gap-filled, the lack of data for different transport subsec32 Relevant NACE groups covered by the EU Scoreboard: NACE 341: Manufacture of motor vehicles NACE 343: Manufacture of parts, accessories for motor vehicles NACE 353: Manufacture of aircraft and spacecraft NACE 355: Manufacture of other transport equipment n.e.c. http://epp.eurostat.ec.europa.eu/portal/page/portal/science_technology_innovation/introduction
46
GHG-TransPoRD D1
tors and countries can explain why the analysis based on the Eurostat BERD database tends to be below the result of a Scoreboard-based approach. Table 3-8:
Aggregated corporate R&D support to selected transport sectors at world level (2008)
NACE group
34 'Manufacture of motor vehicles, trailers and semi-trailers' 341 'Manufacture of motor vehicles' 343 'Manufacture of parts, accessories for motor vehicles' Automotive manufacturers and suppliers 35 'Manufacture of other transport equipment' 351 'Building and repairing of ships and boats' 352 'Manufacture of railway, tramway locomotives, rolling stock' 353 'Manufacture of aircraft and spacecraft'
354 and 355 'Manufacture of motorcycles and bicycles, other transport equipment n.e.c.' Other transport TOTAL TRANSPORT
EU Scoreboard 2009 ICB classification used in the EU Scoreboard
2008 R&D budget (€bn)
Eurostat BERD (BES funds only) 2008 R&D budget (€bn) - Gap-filling 2002-2007 59.9
ICB 335 'Automobiles & parts' (Cat. 'Automobiles' 3353) ICB 335 'Automobiles & parts' (Cat. 'Auto Parts' 3355)
53.0
n.a.
16 (excl. 'Tyres' DH2511) 69
n.a.
59.9 11.1
ICB 271 'Aerospace & defence'
ICB 2753 'Commercial vehicles & trucks'
n.a.
0.7
n.a.
0.4
11.5 (excl. 'Defence' L7522) 6.8
8.7
18.3 87.3
11.1 71
1.0
Data sources: EU Scoreboard 2009 and Eurostat BERD database; all data retrieved on January 2010 Note: Data from Eurostat BERD database are somewhat incomplete. No data available for BE, DK, IE, LV, LT, LU, NL as well as for several non-EU countries (e.g. Taiwan, Russia, China, Australia, Canada). Data for DE and IT have been updated based on BERD figures (all sectors) or, in some cases, from the OECD 33 statistics . BES data for the U.S. are only available for the year 2000.
In order to better assess their differences, Figure 3-15 displays the total R&D investment in transport-related categories (NACE 34 and 35) derived from both databases over the period 2002-2008. Overall, the results show that both databases provide simi-
33 STAN R&D Expenditure in Industry, ANBERD Ed. 2009 (see http://stats.oecd.org/Index.aspx)
Transport R&D Capacities in the EU
47
lar figures, with a similar dynamic, too. Data from Eurostat BERD are considered as underestimates due to the lack of data for several countries worldwide. If we put the emphasis on the NACE 34 subsector (i.e. automotive manufacturers and suppliers), both sources provide results with the same order of magnitude, even if the Eurostat BERD database still underestimates the total R&D spending. Even if such a comparison should be carefully interpreted (see Azagra Caro and Grablowitz, 2008), there is rather consensus between both data sources when considering the worldwide R&D expenditures allocated to the 'transport' sector. Total R&D investment in 'transport'
R&D investment (€2005 bn)
90 80
Eurostat BERD (BES funds) EU Scoreboard
70 60 50 40 30 20 10 0
2002
2003
2004
2005
2006
2007
2008
Total R&D investment in NACE 34 category
R&D investment (€2005 bn)
80 70
Eurostat BERD (BES funds) EU Scoreboard
60 50 40 30 20 10 0
2002
Figure 3-15:
2003
2004
2005
2006
2007
2008
Comparison of worldwide R&D investments between the two databases over the period 2002-2008 (total transport and NACE 34 category; data in real terms €2005)
Data sources: Eurostat BERD (BES funds only) and EU Scoreboard Note: for comparison, tyre manufacturers have been removed from the EU Scoreboard (DH 2511) as well as companies classified within the 'Defence' sector (L7522). In 2008, world tyre manufacturers invested around €3.6bn in R&D while 'defence' related companies accounted for around €4.1bn. Every year of the Eurostat BERD database has been gap-filled with figures from previous years (up to 5-6 years backwards).
48
GHG-TransPoRD D1
3.2
Public R&D investments from Member States
Table 3-9 shows the R&D appropriations provided by the GBAORD database. The figures are incomplete and therefore hardly be in the present analysis for anything but for comparison with other findings. Data are only provided for seven Member States and are only available until the year 2007. This means that for some of the major transport R&D funding Member States (e.g. France and Italy) no data is available, inhibiting an aggregated figure on the EU-27 Member States' public R&D investment of the transport sector. Table 3-9:
Aggregated public R&D budget of selected transport subsectors in selected EU countries
GBAORD classification
R&D appropriations for the EU (€m) in 2007 (gap-filling with 2006 data)
NABS 07 05 'Manufacture of motor vehicle and other means of transport'
657
* NABS 07 051 'Aerospace equipment manufacturing and repairing'
376
* NABS 07 052 'Manufacture of motor vehicles and parts (including agricultural tractors)'
19
* NABS 07 053 'Manufacture of all other transport equipment'
45
Data source: Eurostat (retrieved on February 2010) No data available for the year 2008 Data available for only seven Member States (2007 data for the UK, Spain, Germany and Czech Republic; 2006 data for Romania, the Netherlands and Greece). No data for the U.S. and Japan. Note that some data are only available for the category NABS 07 05.
As for the GBAORD, also the RD&D budgets provided by the IEA database are somewhat incomplete to provide accurate figures about the R&D investments going to the different transport modes and technologies. However it enables to get an estimate of the R&D investments allocated to transport biofuels and hydrogen and fuel cells. The RD&D budgets of the transport-related categories provided by the IEA are summarised in Table 3-10. The RD&D budgets for the U.S. and Japan are given for comparison.
Transport R&D Capacities in the EU
Table 3-10:
49
Public RD&D budgets allocated to transport-related R&D activities
IEA category
I.3 Transportation III.4 Total bioenergy III.4.1 Production of transport biofuels including from wastes V. Hydrogen and Fuel Cells VI.3 Energy Storage
RD&D budget in 2008 (€m, gap-filled) EU19 122 201 64
Out of which demonstration in MS national budgets (€m)
RD&D budget in 2008 (€m) U.S.
RD&D budget in 2008 (€m) Japan
17 44 16
146 136 n.a.
54 13 3
177
17
182
147
32
0
5
59
Data source: IEA RD&D statistics; data downloaded in February 2010 Note: for the EU19, data were gap-filled as follows: 2007 data for AT, BE, CZ, FI and FR; 2006 data for NL and 2004 data for SK. RD&D for biofuels in Spain was estimated based on 2006 figures
Alongside RD&D budgets allocated to alternative fuels (biofuels and H2/FC), the IEA database can be used to approximate the RD&D spending on 'advanced vehicle technologies'. In a recent study, the IEA assessed the 2009 public RD&D expenditures going to 'advanced vehicle technologies', building on the RD&D budgets from the categories 'Transportation', 'Energy Storage' and 'Hydrogen and Fuel Cells', and completing this information by questionnaires (IEA, 2009a). They estimated that around $1.5 billion was spent by the public sector on advanced vehicles worldwide. However, this figure mainly refers to light duty vehicles (LDVs) and cannot be used to distinguish between the different technologies independently e.g. conventional technologies (e.g. new internal combustion engines and drive trains) and electric vehicles (HEV, PHEV, BEV).
3.3
Transport-related R&D investments under FP7
FP7 is running from 2007 to 2013 with the objective to support the aims of the Lisbon Agenda. The total EU FP7 budget is about €50.5 billion34, broken down into four main programmes (Cooperation, Ideas, Capacities, People) as well as JRC contribution. Under the Cooperation Programme (€32.4 billion), the ‘Transport’ theme has been allocated around €4.2 billion and the 'Energy' theme some €2.3 billion (Figure 3-16). Transport research under FP7 aims at developing 'safer, greener and smarter transport systems for Europe that will benefit citizens, respect the environment, and increase the
34 Plus €2.75 billion for nuclear research through Euratom.
50
GHG-TransPoRD D1
competitiveness of European industries in the global market'35. As mentioned earlier, the total budget allocated to the 'Transport' thematic priority is around €4.2 billion (including all transport modes and aeronautics) over the period 2007-2013. This budget accounts for around 13% of the total FP7 budget going to the Cooperation programme (€32.4 billion). EU FP7 (2007-2013) ~ €50.5bn
Ideas
People
COOPERATION
Capacities
JRC
€32.4bn
Health
…
TRANSPORT
…
…
ENERGY €2.35bn
€4.16bn
Renewable fuel production
H2/FC
…
FCH JTI €470m Road, rail, waterborne, multimodal
Horizontal activities
TPT-Galileo €350m
Aeronautics (civil only) €2.3bn
€1.51bn
PPP - European Green Cars Initiative €500m
Figure 3-16:
Collaborative research (TPT-SST; 5 areas) ~ €1bn
Collaborative research (TPT-AAT; 6 areas)
Clean Sky JTI €800m
SESAR JU €350m
€960m
Transport-related research under FP7 (indicative budget)
Source: IPTS, based on several sources (see e.g. decision 1982/2006/EC) Note: figures are indicative and are not necessarily spread over the period 2007-2013
Research in transport covers all modes of transport (people and goods), divided into the following categories (European Commission, 2006): • Aeronautics and air transport: emissions reduction, new engines and alternative fuels, air traffic management, safety and environmentally efficient aviation. • Sustainable surface transport i.e. rail, road and waterborne: clean and efficient engines and power trains, reducing the impact of transport on climate change, inter-
35 http://cordis.europa.eu/fp7/transport
Transport R&D Capacities in the EU
51
modal regional and national transport, clean and safe vehicles, infrastructure construction and maintenance, integrative architectures. • Support to the European global satellite navigation system Galileo and EGNOS. • Horizontal activities Furthermore, alongside the transport thematic priority, other transport-related R&D projects are funded under the thematic 'Energy' (including research projects on biofuels and hydrogen and fuel cells) - with a budget of €2.35 billion and, to a lesser extent, under 'Environment', 'Information and Communication Technologies'36 and 'Nanoproduction' thematics. Under FP7, research on road, rail and maritime transport is mostly funded under the category 'Sustainable Surface Transport' (SST, also including the 'European Green Cars Initiative', see below) through the following five research areas: • Rail, road and waterborne development of clean and efficient engines and power trains; • Reducing the impact of transport on climate change; • Inter-modal regional and national transport; • Clean and safe vehicles; • Infrastructure construction and maintenance, and integrative architectures The relevant stakeholders of the SST (SST platforms) are ERTRAC for road, ERRAC for rail and WATERBORNE TP for maritime transport (see annex for more details). The six sub-themes of the transport thematic 'TPT-SST' are: • TPT-SST-1: The greening of surface transport • TPT-SST-2: Encouraging modal shift and decongesting transport corridors • TPT-SST-3: Ensuring sustainable urban mobility • TPT-SST-4: Improving safety and security • TPT-SST-5: Strengthening competitiveness • TPT-SST-6: Cross-cutting activities for implementation of the sub-theme programme With the focus on road transport, the European Green Cars Initiative (EGCI) is one of the three Public Private Partnerships (PPP) of the European Economic Recovery Plan launched in 2008. The objective of this initiative is to 'facilitate research on a broad 36 Note that ICT-based technologies can help in significantly reducing GHG emissions of the road transport (see e.g. TNO, 2009).
52
GHG-TransPoRD D1
range of technologies to achieve a breakthrough in the use of renewable and nonpolluting energy sources for road transport'. The main actions of the EGCI37 refer to: • R&D activities through FP7 grants for research on greening road transport, with a budget of €1 billion (€500 million from the Commission38 and €500 million from industry and Member States) • Support to industrial innovation through EIB (European Investment Bank) loans with a budget of €4 billion (in addition to existing loans) • Demand side measures & public procurement, such as reduction of circulation and registration taxes for low-CO2 cars The main research focus of the EGCI is on the electrification of mobility and road transport. It should be noted that research efforts not only focus on passenger cars but also on trucks, internal combustion engines, logistics, ITS, both at vehicle and system level. The R&D areas are listed below: • Research for trucks; • Research on greening internal combustion engines; • Research on bio methane use; • Logistics, transport system optimisation; and • Research on electric and hybrid vehicles, notably research on: - High density batteries; - Electric engines; - Smart electricity grids and their interfaces with vehicles. The first calls for the EGCI was launched in July 2009 with a total budget of €108 million for the year 2010, out of which €68 million from the 'transport' theme39. Note also that €25 million are allocated to the joint call on electric batteries. The work programme 2011 (2011 calls, published in July 2010) covers three major R&D themes: Research
37 http://ec.europa.eu/research/industrial_technologies/lists/green-cars_en.html 38 The EU funding of €500 million will be spent over four years (2010 to 2013) with the following indicative breakdown (€95m in 2010; €115m in 2011; €145m in 2012 and 2013). 39 Themes covered by the EGCI and their indicative research budget for the period 2010-2013: - Transport (€220 million i.e. 44% of the total budget) - Energy (€50 million) - Environment (€50 million) - ICT (€120 million) - NMP (€60 million)
Transport R&D Capacities in the EU
53
for heavy duty vehicles based on internal combustion engines; Research on electric and hybrid vehicles; Logistics and co-modality combined with intelligent transport system technologies40. The Aeronautics and Air Transport theme (AAT) is part of the 'Transport' thematic priority described previously. The first priority under the ATT is the ‘Greening of Air Transport' in order to reduce GHG emissions and environmental impact of civil aviation (note that FP7 does not allocate funds to military aeronautics research). The AAT Work Programme is divided into six activities (European Commission, 2010): • The Greening of Air Transport • Increasing Time Efficiency • Ensuring Customer Satisfaction and Safety • Improving Cost Efficiency • Protection of Aircraft and Passengers • Pioneering the Air Transport of the Future Under FP7, a total of €960 million (2007-2013) is allocated to 'Collaborative Research' in order to reduce the environmental impact of aviation and improve the efficiency, competitiveness and safety of this transport mode. In addition, €800 million has been dedicated to the Clean Sky Joint Technology Initiative (see below) focusing also on environmental aspects. Note that another €350 million has been contributed by the EU towards financing the SESAR Joint Undertaking on new air traffic management system (see below). As shown in Figure 3-17, the FP7 budget has considerably increased with respect to the previous FP6, with an overall budget of €293 million per year.
40 2011 calls (20 July 2010) http://www.green-cars-initiative.eu/open-fp7-calls/calls-for-proposals
54
Figure 3-17:
GHG-TransPoRD D1
Overall FP budget allocated to the aviation sector
Source: European Commission, 2010
As mentioned earlier, the Clean Sky Joint Technology Initiative (Clean Sky JTI)41 is a pillar for EU research in civil aviation. The Clean Sky JTI was launched beginning of 2008 with the clear objectives to turn the ACARE environmental goals into reality (see annex). It is one of the largest European research initiatives with a budget estimated at €1.6 billion over seven years, of which half is funded by the European Commission and half by the EU Aeronautics industry. It means that the Clean Sky programme accounts for more than 45% of the total public FP7 budget for the aviation sector. This publicprivate partnership brings together European R&D stakeholders to develop ‘green’ air vehicle design, engines and systems aimed at minimising the environmental impact of future air transport systems. Members of the Clean Sky JTI are the European Commission, ITD (Integrated Technology Demonstrators) leaders and associates. The total budget of €1.6 billion will be spent on the following research programmes: • Smart Fixed Wing: €372m (24%) • Green rotorcraft: €155m (10%) • Green regional aircraft: €177m (11%) • Green engines: €419m (27%) • Systems for green operation: €295 (19%) • Eco-Design: €109m (7%) • Technology evaluator: €31m (2%) • Running costs: €48m (3%)
41 http://www.cleansky.eu/
Transport R&D Capacities in the EU
55
The first six programmes have set different targets for reducing CO2 emissions, NOx emissions and noise (see e.g. Denos, 2009). Since November 2009, Clean Sky has become a legal autonomous entity (no longer steering by the EC) with its own executive board. Furthermore, the SESAR Joint Undertaking42 initiative (Single European Sky ATM Research) was created in 2007 as a legal entity to coordinate the development phase (2008-2013) of the SESAR programme (2004-2020). This major programme is the technological pillar of the Single European Sky (SES) initiative that aims at developing a new, more efficient air traffic control systems. The objective is to ensure 'the safety and fluidity of air transport over the next thirty years, will make flying more environmentally friendly and reduce the costs of air traffic management.' The SESAR programme consists of three phases namely the definition phase (2004-2008), the development phase (2008-2013, coordinated by the SESAR JU) and the deployment phase (20142020). With the focus on environment, two main objectives for 2020 have been set43: • 10% reduction in fuel consumption/CO2 emissions per flight as a result of ATM improvements alone (see ACARE goals for CO2 emissions reduction) • Minimise noise emissions for each flight to the greatest extent possible Transport-related R&D is also funded through the thematic 'Energy' under the subthemes 'Renewable fuel production' and 'Hydrogen and fuel cells'. The first category includes a wide number of research projects in bioenergy (e.g. on advanced biofuels), while research in hydrogen and fuel cells is funded through the Fuel Cells and Hydrogen Joint Technology Initiative (FCH JTI, see annex). In the framework of this publicprivate partnership, the Commission will fund €470 million from the FP7 programme over six years (i.e. an average of €78 million per year) with at least the same amount coming from the private sector
42 http://www.sesarju.eu/ 43 For more details, see the European ATM Master Plan Portal https://www.atmmasterplan.eu/
56
GHG-TransPoRD D1
3.4
Key outcomes from the overall analysis
Corporate R&D at world level •
Around €95 billion was invested in transport R&D worldwide for the sole year 2008, which represents a 11% increase compared to 2007. Automotive manufacturers spent €53 billion in R&D, which makes them the most important player followed by automotive suppliers with almost €20 billion.
•
The total R&D investment mainly stemmed from industries with headquarters based in three regions of the world: Europe (43%), Japan (28%) and the U.S. (26%).
•
Both the Eurostat BERD and the EU Scoreboard data sources converge (at global level) towards similar expenditures when considering the corporate R&D allocated to transport-related NACE categories.
Corporate R&D at European level •
Automotive manufacturers invested more than half of the €40 billion spent in transport in the EU during the year 2008, followed by investments realised from automotive suppliers and 'aerospace and defence' companies.
•
Around 80% of the €40 billion only came from a dozen companies, most of them having their headquarters in Germany, France and Italy.
Overall •
Both at the global and EU level, the transport sector is the largest industrial R&D investor.
•
Industrial R&D intensities are relatively elevated in the order of 4-8%, which indicates that the sector is comparably research-intensive.
•
Much of the R&D investments stems from relatively few industrial players.
•
EU databases such as GBAORD (or IEA for RD&D budgets) do not provide comprehensive aggregated figures of the public R&D investments in transport from EU Member States, in particular not at a high level detail. This makes a comparison between corporate and public R&D investments at this aggregated level difficult – such a comparison will therefore be undertaken in the following chapter.
Transport R&D Capacities in the EU
4.
57
RESULTS II – R&D investment for reducing GHG emissions by mode and technology. Results from a bottom-up analysis.
In the previous chapter, the results showed an overall picture of the R&D efforts in the transport sector but on the ICB classification. This chapter now presents the corporate and public R&D investments resulting from our bottom-up analysis as described in the methodology. The objective is to go further in the analysis by 1) estimating how much R&D is spent in each transport mode (road, rail, maritime and aviation) exclusively; 2) estimating how much of this amount is allocated to reduce GHG emissions and 3) estimating the R&D spending flows towards key technologies (for the automotive sector only). As already mentioned in the methodology, such an exercise is subject to significant uncertainty levels increasing with the level of detail required. At the most aggregated level, the results of our bottom-up analysis shows that the transport sector as a whole invested at least €40 billion in R&D in 2008, most of this amount (94%) being financed by industry (EU-based companies only), although this share varies across the different modes of transport. We estimate that at least one third (32-35% approximately) of this total is targeted at reducing the fuel consumption/GHG emissions of this sector. Furthermore, several indicators reveal that this share has increased over the last years and is going to increase in 2009. A more thorough analysis of R&D investments towards the different transport modes (road, air, rail and maritime) is provided in the following.
4.1
Road transport
According to our bottom-up analysis, the aggregated research investment in road transport is estimated to have reached almost €32 billion in 200844, out of which only 2.5% was financed by the public sector. More than €13 billion (43%) of this amount was invested into R&D activities for developing 'greener' technologies i.e. including air quality and GHG emissions reduction, the latter contribution being estimated to lie between €10 billion and €11 billion (32-35% of the total).
44 Note that this total would reach some €33 billion if biofuels and fuel cells are included.
58
GHG-TransPoRD D1
Table 4-11:
Approximate R&D investments in the EU automotive sector (2008) Corporate R&D investment (€m)
Automotive sector
R&D in technologies for reducing GHG & air pollutant emissions R&D in technologies for reducing GHG emissions
31,000 Turnover: €594bn R&D intensity: 5.2% 13,400
Public EU FP7 (€m, avg per year) 150
Public MS R&D (€m)
n.a.
n.a.
Total R&D investment (€m) 31,800 (2.5% from public funds) n.a.
60
210
10,300-11,300
10,000-11,000
650
Source: IPTS (rounded numbers) Note: Research investments in road alternative fuels are not fully included in the total R&D. Corporate figures are based on the analysis of 50 EU-based companies; Public MS figures are derived from a wide variety of sources (EAGAR project, ERTRAC studies, own country-based analysis, expert judgment, etc.) and rely on the analysis of 14 Member States.
4.1.1 Total corporate R&D R&D investments in 2008 The present figure is derived from the analysis of 50 EU-based companies that are key player of the EU automotive industry. The assessment shows that road research is highly driven by the private sector with €31 billion spent in 2008 out of a total of around €32 billion when public funds are included. The aggregated revenue of this sector was found to be almost €600 billion in 2008 thus leading to a R&D intensity of around 5.2%. These figures are very well in line with the top-down analysis of the sector made in section 3.1.1.3. It does not come as a surprise that the EU automotive manufacturers are by far the most important investors with around €21.7 billion spent in 2008 associated with a turnover of €456 billion. These figures indicate that the R&D intensity of the EU automotive manufacturers has been around 4.8% in 2008. In order to account for the systematic differences between road freight and road passenger transport, we further disaggregated the research efforts of EU manufacturers into those related to passenger cars45 and to commercial vehicles (trucks, buses and vans). This distinction required to examine the R&D investments allocated to the differ-
45 Note that R&D investments on two-wheelers are included in this category (we estimated this contribution to be in the order of €250 million in 2008, see box 2).
Transport R&D Capacities in the EU
59
ent divisions of a parent company (e.g. Iveco for Fiat, Scania and vans for Volkswagen, Daimler trucks, etc.). The following results have been found: •
Out of the almost €22 billion spent in 2008, we estimated that €3.8 billion (i.e. 17% of the total) was invested in R&D in commercial vehicles with a turnover of around €107 billion46 in 2008. The R&D intensity of this segment has then reached 3.6% in 2008.
•
The R&D investments directed to the passenger cars segment represent the highest share with almost €18 billion spent in 2008, along with a turnover of €349 billion (R&D intensity of 5.1%).
The substantially higher levels of R&D investment volumes together with the higher R&D intensity of car manufacturers compared to manufacturers of commercial vehicles can be explained by the very distinct nature of road passenger and road freight transport. In road freight transport, the high competition and the consequently high price pressures means that transport companies focus largely on reducing their costs. Given that the share of fuel costs out of the total operating cost for commercial vehicles is typically around 30% (see e.g. Durelli, 2007; Faber Maunsell, 2008) and that the other major cost component – wages – cannot be reduced much further, the fuel efficiency of new trucks is an important purchase criterion. Nevertheless, transport companies will follow a strict economic calculus when buying new equipment and are not ready to pay for 'innovative technologies' as such. This situation is different in passenger cars, where consumers' choice is influenced by a variety of factors. Cars are more exposed to a 'differentiation and branding pressure', and innovative technologies can be one selling factor. The EU automotive suppliers invested at least €9.3 billion in 2008 with a turnover of almost €140 billion. It should be noted that this figure is an underestimate since not all EU automotive suppliers have been included in the present analysis47. This sector presents the higher R&D intensity with around 6.7%, i.e. around 2% greater than for the EU automotive manufacturers industry as a whole.
46 Analysis based on annual figures from Daimler Trucks (Mercedes), Daimler vans and buses, Fiat (Iveco), Volvo (Volvo Trucks and Buses, incl. Renault Trucks), Volkswagen (Scania and VW commercial vehicles) and MAN (commercial vehicles). 47 Note however that R&D investments of Faurecia (PSA Group) and Magneti Marelli (Fiat group) have been assigned to the automotive suppliers segment here.
60
GHG-TransPoRD D1
Going beyond 2008 As already mentioned the present analysis focuses on the R&D investments for the year 2008 and thus prevents to take into account the impact of the recent economic crisis on this sector. However, in order to get an overall picture of the latest changes, an analysis of the R&D investments (and R&D intensity) of the main EU-based automotive manufacturers over the period 2007-2009 has been undertaken. Based on the company's annual reports48 (including the latest for the year 2009), the following outcomes have been found when focusing on the EU automotive manufacturers: •
The economic crisis has sharply reduced the overall net sales in 2009, by around 16% compared to the year 2008. The commercial vehicles segment has been the most affected (-33% of net sales), compared to -10% for passenger cars.
•
The overall R&D investment has been reduced by 10% in 2009, which yet represents a slower decrease relative to the overall turnover. The highest decrease has been observed for the passenger cars segment (-11% of R&D investments) while the commercial vehicles segment shows a more limited reduction with 7%.
Following from the slower decrease of R&D investments compared to the turnover, the overall R&D intensity of EU-based automotive manufacturers has globally increased, from 4.4% in 2007 to 4.8% in 2008 and 5.1% in 2009. For passenger cars, the R&D intensity has been found to be constant between 2008 and 2009 (5.1%) while it has significantly grown for commercial vehicles, ranging from 3.1% in 2007, to 3.5% in 2008 and 4.9% in 2008. It is worth mentioning that this global increase has been observed for all the companies (or subsidiaries) analysed in the commercial vehicles segment, which is not systematically the case for passenger cars where differences can occur between car manufacturers. As an example, the R&D intensity of Volvo (trucks and buses) has increased from 3.8% in 2007 to 5% in 2008 and to 6.6% in 2009. Volvo (trucks and buses) shows the largest R&D intensity of the commercial vehicles segment in 2009 with 6.6% (6.3% for the Volvo group). As a result, the R&D intensity of both segments has been found to be relatively similar in 2009 contrary to the previous years (see Figure 4-18). 48 In the assessment of 2008 figures, we use company data as reported in the EU Industrial R&D investment scoreboard to the extent possible, as this already treats some information provided in the companies' annual reports (i.e. subtracting the parts of publicly financed research etc.). As by the time of writing of the present report, the update of the Scoreboard including 2009 figures has not been available, the 2009 figures refer directly to information extracted from companies' annual report. In any cases, differences are of very minor nature.
Transport R&D Capacities in the EU
61
Furthermore, there is indication that the share of R&D investments going to 'green' technologies has been increasing, even though the total R&D expenditures have decreased (see box 4). This means that companies have directed their investments into specific technologies that are considered to have a lower risk and a return on investment in a shorter timeframe, such as electric vehicles compared to e.g. fuel cell vehicles. This trend is also confirmed by the results of two distinct patent analyses shown in section 5.1. To some extent these findings may indicate that companies consider investments in R&D as a strategy for overcoming the times of crisis being well positioned compared to their competitors in the expected uptake after the crisis. Experience from the effect of liberalisation on R&D in the energy sector also suggests that a higher price pressure favours incremental innovations with lower risks (Markard et al., 2006), which would confirm our findings. Process innovations and the pursuing of technologies that are close to the markets would be preferred to radical innovations that lead to the invention of innovative technologies or systemic innovations that require deeper changes to the entire system. One nevertheless needs to take into account that a one-year change can also be influenced by a number of other factors, such as inertia in adapting R&D budgets on a short term, and should therefore not be over-interpreted. Similar trends have been observed for some key EU automotive suppliers (e.g. Bosch, Continental, Valeo, ZF) showing an increase of R&D intensity in spite of important reduction of revenues. Nevertheless, available data has not allowed for a systematic update of all major supplier companies at the time of writing of this report. For comparison, note however that an assessment of the main EU aeronautic companies indicates that the net sales of this sector have globally increased between 2008 and 2009. But except for some companies (e.g. EADS), the R&D intensity has slightly been reduced between 2008 and 2009.
62
GHG-TransPoRD D1
EU Automotive manufacturers 1.6 1.5 1.4
Sales R&D investment R&D intensity
1.3 1.2 1.1 1 0.9 0.8 0.7 0.6 2007
1.4
2009
Passenger cars
Commercial vehicles
1.6
1.6 1.5
2008
Sales
1.5
R&D investment
1.4
R&D intensity
1.3
1.3
1.2
1.2
1.1
1.1
1
1
0.9
0.9
0.8
0.8
0.7
0.7
0.6
Sales R&D investment R&D intensity
0.6 2007
Figure 4-18:
2008
2009
2007
2008
2009
Recent trends in net sales, R&D investments and R&D intensity of the EU automotive industry (2007-2009; normalised data 2007=1)
Source: IPTS Note: analysis based on Daimler, Volkswagen, BMW, Fiat, PSA Peugeot Citroën, Renault, Porsche, Volvo and MAN into the segments 'commercial vehicles' and 'passenger cars' exclusively (a list of divisions is given in annex 1)
Transport R&D Capacities in the EU
63
4.1.2 Corporate R&D investments for reducing GHG emissions The automotive industry devotes a large share of its R&D investments on R&D activities directly or indirectly targeted at reducing the energy consumption/GHG emissions of road vehicles49. In the present study, this share has been assessed for the major EU-based companies of this sector, based on information or indication from a wide range of sources (companies' annual and sustainability reports, speeches, direct contacts, reports, etc.). Unfortunately, although there is consensus among the actors to claim that 'most' of their R&D investments is dedicated to reduce the 'environmental impact' or to develop 'green' or 'environmentally-friendly' technologies, there is very limited available information about a precise level of investments in this domain (see box 4 for an overview of recent press releases). According to our research, it has been estimated (as a proxy) that around 43% of the total R&D investment of the private sector in 2008 was spent to reduce the environmental impact of this sector, i.e. including research on GHG emissions reduction and air quality. When differentiated between automotive manufacturers and suppliers, it was found that this share reached 45% and 38% respectively. In a second step, it was assessed that R&D efforts for reducing GHG emissions amounted to some €10-11 billion, i.e. approximately 32-35% of the total R&D investments in 2008 (split into 36% for automotive manufacturers and 29% for automotive suppliers). The above results are summarised in Figure 4-19 below, differentiated between automotive manufacturers and suppliers.
49 Some research efforts that results in enhanced fuel efficiency or decreased weight etc. may have been motivated by other than environmental considerations, e.g. to increase the 'joy of driving', and may be (partly) outweighed by more performant cars etc. Nevertheless, the technology can save GHG emissions and is therefore allocated to this group for the purpose of the present exercise.
64
GHG-TransPoRD D1
25
7%
6% 7.9
15
R&D for reducing GHG emissions
5%
Other R&D (safety, comfort, etc. but also air pollutant emissions)
4%
R&D intensity (%) (right scale) 3%
10 14.3
2.6
R&D intensity
R&D investment (€bn)
20
2%
5 6.2 0
0%
Automotive manufacturers
Figure 4-19:
1%
Automotive suppliers
Approximate R&D breakdown and intensity of the EU automotive industry in 2008
Source: IPTS
The different 'low-carbon' technology areas in which these investments are directed to, will be analysed in more detail in the following. It concerns essentially the optimisation of power trains (engines and transmissions), the development of alternative drives (e.g. electric and hybrid technologies), the use of alternative fuels (e.g. biofuels), as well as improvements related to the car body (reducing aerodynamic resistances, weight) and auxiliaries (e.g. air conditioning).
Transport R&D Capacities in the EU
65
Box 4: What can be found from a web-based research? As shown previously, the automotive industry is the largest investor in R&D in Europe with more than €30 billion spent in 2008. This huge investment is essentially targeted to develop safer, more intelligent, more comfortable and of course 'greener' vehicles. The last objective is doubtless the most important challenge the automotive industry is currently facing. Most of the actors in this area, namely automotive manufacturers and suppliers, agree to say that a 'large share' or 'most of' the corporate R&D investment is allocated for improving the vehicle energy efficiency and then reducing greenhouse gas emissions. For instance, the ACEA50 reported that 'A large part of the R&D investments is spent on technologies to reduce emissions of greenhouse gases such as carbon dioxide (CO2)'. But how much exactly? What about the evolution of this share in the near future? Except in a few cases, no accurate figure is disclosed about the real share of R&D investment going to GHG emissions reduction and its (supposedly) growth over the last years. Assessing the precise share of the total R&D allocated to GHG emissions reduction is very difficult; instead, only rough estimates can be obtained. In those cases where we obtained more precise information, this shall be shown in the following. Thomas Weber (Daimler) reported that Daimler spent €4 billion in R&D of which half going to green technologies, CO2 emission reduction and Euro 6 standard51. In September 2008, a similar press release confirmed this information saying that 'Daimler has raised the share of its investments in more economical vehicles from 25 percent to 60 percent. At Volkswagen and BMW, one in every two euros goes into environmentally friendly technologies'52. At the same date, C. Ghosn (Renault) claimed that the Alliance Renault-Nissan allocated one third of its R&D expenditures to clean vehicles, with the priority going to zero emission vehicles53. In November 2009, G. Faury (PSA Peugeot Citroën) declared that the PSA group will allocate more than half of its R&D expenses over the period 2010-2012 towards new technologies for reducing CO2 emissions and pollutants54. In its last annual report (2009), PSA Peugeot Citroën indeed reported that half of its R&D efforts is devoted to 'clean technologies' aiming at reducing the carbon footprint of vehicles. On their website, Bosch reports that 'in 2009, some 45 percent of Bosch’s research and development budget again went into products that conserve resources and protect the environment' (see Bosch's annual report 2009). At global level, a recent study from the consulting group Oliver Wyman reported that 'today, automakers are already investing about one-third of their worldwide research and development expenditure of some Euro 75 billion on this goal on these efforts, which include both further optimizing traditional combustion drives and developing alternative drive technologies for serial production. In the next ten years, investments in reducing carbon dioxide worldwide will total around Euro 300 billion – of which Euro 50 billion will be spent on alternative drive systems like hybrid or electric.'55 With regard to patent applications of the automotive sector, the German Association of the Automotive Industry (VDA) stated that 'On average, the German automotive industry applies for ten patents daily, a good half of which are in the field of environmental engineering'56. Based on all these various 'official' announcements, there is evidence that the share of R&D spending allocated to GHG emission reduction is high, probably ranging from one third to more than half of the total R&D budget depending on the car manufacturer and the year considered. This gives an indication about the order of magnitude where our results should range. 50 European Automobile Manufacturers' Association 51 Interview of T. Weber (07/10/2008) available at: http://www.usinenouvelle.com/article/l-interviewthomas-weber-responsable-rd-daimler-et-mercedes-benz.148420 52 http://www.atlantic-times.com/archive_detail.php?recordID=1460 53 Interview of C. Ghosn, Le Parisien (02/10/2008) http://www.leparisien.fr/automobile/mondial-auto2008/voiture-propre/renault-presente-sa-voiture-electrique-02-10-2008-263108.php 54 Interview of G. Faury (27/11/2009) about the PSA vision about CO2 emissions reduction, originally released by the Financial Times. http://www.ccfa.fr/article87729,87729.html 55Oliver Wyman study 'E-Mobility 2025' (September 2009) http://www.oliverwyman.com/ow/pdf_files/ManSum_E-Mobility_2025_e.pdf 56 VDA, Annual Report 2009 available at http://www.vda.de
66
GHG-TransPoRD D1
4.1.3 Public research Public funds originated from the EU countries in road transport reached €650 million in 2008. This figure cannot be compared to available EU databases such as GBAORD or the IEA due to their incompleteness (see chapter 2.2) but it can be seen as an underestimate since it results from an analysis based on only 13 Member States57. Out of the €650 million, €210 million has been estimated to be invested for reducing GHG emissions. Despite the high uncertainties associated with this figure (mainly due to the fact that R&D activities focusing exclusively on GHG emissions reduction are not easily identifiable within national research programmes), this amount represents 32% of the public MS funding in road transport, supported by important research programmes launched in France (e.g. PREDIT programme), Germany, UK, Italy and Austria (see annex). The EU public research support to road transport through FP7 funds as assessed in the present study reached some €142 million on an annual average. This amount mainly stems from the budget allocated to the collaborative research on road transport under the thematic priority TPT-SST (including the European Green Cars Initiative). It has been estimated that around 40% (€60 million per year on average) of the €142 million was directly devoted to reduce GHG emissions, in partly due to the funds from the EU Green Cars Initiative (started in 2010).
4.1.4 R&D investment in road vehicle technologies The assessment carried out so far revealed that the EU automotive sector invested more than €30 billion in R&D in 2008, out of which more than 40% was targeted to reduce the environmental impact of vehicles (and one third for reducing GHG emissions). To go further in the analysis, a question then arises as to know how much of this amount is directed towards low-carbon technologies. Figure 4-20 presents a global picture of technological fields in which R&D efforts are generally undertaken by the automotive sector to reduce the energy consumption and the environmental impact of vehicles. Typically, five key research areas can be distinguished:
57 Germany, France, Austria, Belgium, UK, the Netherlands, Sweden, Finland, Denmark, Belgium, Spain, Italy and Romania.
Transport R&D Capacities in the EU
•
67
Optimising conventional drive technologies: it refers to the improvement of powertrains (engine and transmission) and still represents one of the best means (at least in the short-to-medium term) to reduce GHG and air emissions in order to fulfil the EU regulations.
•
Developing alternative drive technologies: it generally includes R&D in electric vehicles (i.e. battery electric vehicles (BEVs), hybrid electric vehicles (HEVs) and plug-in hybrid electric vehicles (PHEVs)) and fuel cell technologies. Both technologies have not reached the same level of maturity and require different strategies.
•
Alternative fuels: the use of alternative fuels in road transport such as biofuels or CNG is an important part of the R&D strategy for this sector, whatever funded by the industry or through public funds. However, the scope of this research topic goes well beyond the automotive sector and should include R&D investments from e.g. energy suppliers.
•
Optimising vehicle design: this 'category' focuses on R&D activities related to the car body i.e. for reducing the vehicle weight as well as drag resistances (aerodynamic and rolling resistances). - Reducing the vehicle weight by using lightweight materials (e.g. through the displacement of conventional ferrous metals with e.g. high strength steel (HSS), aluminium, magnesium, composites) can lead to significant fuel consumption reduction (as well as improving air quality). However, the equation is quite complex since weight reduction is directly connected to safety and comfort issues meaning that a trade-off is necessary between all these constraints. - Drag resistances: important R&D efforts are regularly undertaken by the automotive industry to reduce the aerodynamic drag (depending on the speed, vehicle shape, air density, etc.) and rolling resistance (caused by the tyre deformation, depending on the vehicle speed and weight). For aerodynamics, experimental (wind tunnel testing) and simulation tools (e.g. CFD software) are widely used to optimise the car shape and then reduce, as much as possible depending on the constraints (safety, comfort), the aerodynamic drag coefficient. Regarding the rolling resistance, important fuel savings can be obtained by systematically using low rolling resistance tyres (LRRT) and tyre pressure monitoring systems (TPMS).
68
GHG-TransPoRD D1
•
Auxiliaries: R&D efforts are permanently carried out to optimise auxiliaries such as the mobile air conditioning system (MAC).
TOTAL R&D INVESTMENT (~ €30bn)
Safety (braking systems, stability, speed control, etc.).
Optimising conventional drive technologies
Energy consumption & emissions
Developing alternative drive technologies
New transmissions (manual/automatic gearboxes, dual-clutch, CVT, etc.) Optimising internal combustion engines (architecture, components, injection systems, valve control, thermal management, reduce friction losses, downsizing, etc.). But also exhaust after-treatment technologies, etc.
Comfort (e.g. thermal, acoustics, vibrations)
Use alternative fuels (e.g. biofuels, CNG)
Optimising vehicle design
Auxiliaries (e.g. MAC)
Reducing weight (use of lightweight materials)
Fuel cell vehicles (Long term)
Pure electric, hybrid (micro, mild, full) and plug-in hybrid technologies (Short-to-medium term)
Other (e.g. communication technologies, ITS)
Reducing drag resistances (aerodynamic and rolling resistance)
Main objective: improve cost-effectiveness
Objectives: improve fuel efficiency, reduce GHG and pollutant emissions in order to comply with the future emission regulation (Euro VI norms in 2014) and CO2 emissions limit (130g/km for 2015 and 95 g/km for 2020)
Figure 4-20:
R&D investment flows in road vehicle technologies for reducing GHG emissions (overall picture only, R&D topics coloured in grey are those for which the R&D investment will be estimated).
Source: IPTS
Due to the wide number of road vehicle technologies available for reducing CO2 emissions in the automotive sector, our assessment will focus on the R&D investments in new engine technologies, electric and fuel cell vehicles as well as biofuels. Obviously, such an assessment is subject to important uncertainties, especially for the private sector since (except in a few cases) the automotive industry does not provide figures at this level of details. The potential CO2 emissions reduction (along with costs when available) related to several low-carbon vehicle technologies have been analysed in detail by recent literature (see e.g. IEA, 2009c; EPA, 2008; King, 2007; AEA, 2009; Kobayashi et al., 2009; IFP, 2009b; Fontaras and Samaras, 2009).
Transport R&D Capacities in the EU
69
Table 4-12 shows the order of magnitude of the R&D investments towards conventional engines, electric vehicles, fuel cells and biofuels. These ranges are the result of a combination of different sources and analyses (patents analysis, annual reports, expert judgments, etc.) and thus present significant uncertainties. Table 4-12:
Approximate R&D investments in road vehicle technologies (2008) Corporate R&D investment (€m)
Conventional engines Electric vehicles (incl. BEV, HEV, PHEV) Fuel cells (and H2 production) Transport biofuels
5000-6000 1300-1600
Public EU FP7 (€m, avg per year) No estimates 20
300-400 (100) 270
Public MS R&D (€m) 80-125 60-100
Total R&D investment (€m) 5080-6125 1380-1720
65 (15)
135 (45)
500-600 (160)
55
65 (200 for bioenergy)
390
Source: IPTS (rounded numbers) Note: Data for public MS R&D investments are derived from the IEA RD&D statistics (with gap-filling applied). Data for FP7 are annualised over the duration of the programme; including funding of the HFC JTI and the European Green Cars Initiative. Corporate R&D investments are derived from a patent-based analysis of the major EU companies of this sector and completed by further sources.
Despite the fact that the figures on public R&D investments on road vehicle technologies are an underestimation, the very limited role of public R&D spending becomes obvious. This certainly applies to the overall investments where the share of public spending remains below 3% of the total, but also to the parts of investments that support research into technologies aiming at reducing the GHG emissions of vehicles (Wiesenthal et al., 2010). R&D investments in conventional engines According to the present analysis, R&D investment for optimising/developing ICE technologies ranged in the order of €5-6 billion in 2008, thus accounting for around half of the total R&D spending for reducing GHG emissions of the sector. This figure is mainly based on corporate R&D investment that is by far the largest contributor (only 2% were found to come from public funds although no figures have been estimated for EU FP7related funding in this area). Despite important (but unavoidable) uncertainties associated to this figure58, such a huge investment does not come as a surprise since automotive manufacturers and suppliers have been massively investing in the optimisation 58 There are two main sources of uncertainties. Firstly, it is very complex to systematically isolate R&D investments on conventional engines from R&D investments on transmission. Secondly, it was not feasible to systematically isolate R&D activities targeted at reducing GHG emissions from R&D activities for improving air quality (e.g. exhaust after-treatment technologies).
70
GHG-TransPoRD D1
of conventional engines (diesel and gasoline, depending on the firm's strategy). As highlighted in Figure 4-20, there exist several domains of research, all of them having the potential to reduce, at different degree, the vehicle emissions (GHG and air pollutants). R&D investments in electric vehicles In 2008, the R&D investment into electric vehicle technologies (BEV, HEV, PHEV) was estimated to reach some €1.4-1.7 billion, most of this amount stemming from the private sector. This important investment is the result of a growing interest of the EU automotive industry sector in this field. Today, most of the automotive manufacturers are involved in the 'electrification' race and have set up partnerships (e.g. Joint ventures) with battery manufacturers59, automotive suppliers and also energy suppliers to develop electric vehicles worldwide (see Part II, in particular Figure 6-40). The results of the patent search (section 5.1) also clearly underline the importance given to research in electric vehicles in more recent years, therefore supporting the figures found here. We estimated that between 5% and 8.5% of the total R&D invested in electric vehicles stems from public funds. Yet note that since 2008, the year of the present assessment, several Member States have launched important research programmes in this area (see annex) and have set up ambitious targets for 2020 and 2030 as it is the case for Germany and France. Under FP7, an annual average of around €20 million was estimated to be allocated for electric vehicles60. R&D investments in fuel cells R&D investments in fuel cell technologies attracted some €500-600 million by 2008. This elevated investment may be explained by the fact that R&D in fuel cells for transportation could not be systematically isolated from stationary and portable applications, thus leading to an overestimation. The total public R&D spending (i.e. from EU Member States and annualised EU funds under FP7) amounted to around €200 million, with the EU funding under FP7 having accounted for one third of this. The assessment of the corporate R&D investment is based on the analysis carried out by Wiesenthal et al. (2009) for the year 2007, which resulted from an analysis of around 70 companies active in this area. The results show that the corporate R&D in59 Most of the battery manufacturers have their headquarters outside the EU (e.g. Japan and the U.S.). Evonik (DE), Saft (FR), BASF (DE) are key EU industries involving in R&D activities in this area. 60 See e.g. the calls for proposals on the electrification of road transport launched in the frame of the EU Green Cars Initiative in 2009.
Transport R&D Capacities in the EU
71
vestments in fuel cells are relatively high (€300-400 million) which is mainly due to the large number of companies active in this research area and their high interest in this technology that is considered as a strategic research field for many of them61. A more thorough analysis of the R&D investments in fuel cells (incl. also hydrogen) and the source of discrepancies with other references is provided by Wiesenthal et al. (2009). R&D investments in biofuels The research budget dedicated to transport biofuels amounted to €390 million in 2008, which reflects the fact that biofuels is a key research area. This figure is not restricted to research into second generation biofuel production pathways but comprises all transport biofuel technologies. The corporate contribution to this investment amounted to €270 million based on the analysis carried out by Wiesenthal et al. (2009). The public share of R&D investments has been greater than 30% in 2008 with EU funds through FP7 amounted to around €55 million on an annual average. The limited share of public R&D investments may not only be due to the relatively elevated maturity of biofuels, but may also be explained by data restrictions (Wiesenthal et al., 2009). Furthermore, the data suggest that some Member States may not explicitly disclose R&D on biofuels, but rather allocate it under the category bioenergy-related research. In 2008, the total R&D investment in bioenergy for the EU Member States reaches some €200 million out of which only €65 million was allocated to transport biofuels.
4.1.5 Synthesis The results of our bottom-up analysis show that the total R&D investment of the European automotive sector in 2008 has reached some €32 billion, out of which 42% (€13.4 billion) was dedicated to reduce the environmental impact of road vehicles. R&D efforts for reducing GHG emissions were estimated to account for €10-11 billion of this total (Figure 4-21). A more thorough analysis of the R&D flows into GHG emissions reduction technologies reveals that the largest share of this investment is due to R&D efforts in optimising conventional engines, although R&D efforts for developing electric vehicle technologies have represented a significant share with around €1.4-1.7 billion spent in 2008. Fur-
61 For instance Daimler (as well as non-EU based companies such as Ford and Toyota) have confirmed their commitment to this technology and foresee that the technology will be for sale around 2015 (Hybridcars.com, 2009).
72
GHG-TransPoRD D1
thermore, R&D investments in biofuels and fuel cell technologies have been assessed to be both in the order of €0.4-0.6 billion during the same year.
Electric vehicles (€1.4-1.7bn)
Conventional engines (€5-6bn)
R&D - Other R&D activities (safety, comfort, etc.)
Biofuels (ca. €0.4bn)
R&D - GHG emissions reduction ~€32bn €10-11bn s
R&D - Air pollutant emissions reduction
Figure 4-21:
Fuel cells (€0.5-0.6bn) Other GHG emission reduction technologies
~€13.5bn
Overall public and private R&D investment flows in the automotive sector in 2008
Source: IPTS Note: Parts of the R&D investments dedicated to biofuels and fuel cells are funded by companies that lie outside of the scope of the main assessment (such as energy suppliers and specialised fuel cell companies). In theory, they would add to the total 'R&D GHG emission reduction' of the automotive sector but their contribution remains limited relative to the total and lies within the uncertainty provided in the figure of €10-11 billion.
At global level, there is evidence that the major part of these investments is conducted by the EU automotive industry, the public funds (incl. national Member States and EU FP7 funding) only accounting for 2.5% of the total in 200862. However, at the level of GHG reduction technologies, the corporate/public distribution of R&D investments presents a different picture. As shown in Figure 4-23 below, the share of public investments (from Member States and EU FP7) can vary from less than 3% for conventional engines to more than 35% for fuel cell technologies. This can be explained by industrial research efforts generally preferring relatively mature technologies, and public efforts concentrating on less mature technologies and research of more basic nature. This fact underlines the more elevated importance of public research in fuel-cell related research compared to e.g. electric vehicles.
62 It is important to keep in mind that considering only 2008 data means that major public support programmes taken in the context of the economic crisis have not been included in the present assessment.
Share of public R&D investment (MS + FP7)
Transport R&D Capacities in the EU
Figure 4-22:
73
40% 35% 30% 25% 20% 15% 10% 5% 0%
Conventional engines
Electric vehicles (incl. hybrids)
Biofuels
Fuel cells
Share of public R&D investment into different road technologies (2008)
A more detailed analysis of the source of R&D investments for these four technologies is given in the following Figure 4-23. Approximate R&D - Conventional engines
Approximate R&D - Electric vehicles
2%
1% 5%
94%
98%
Approximate R&D - Biofuels 17%
Approximate R&D - Fuel cells Corporate R&D investment (2008)
24%
Public EU (FP7, annual average) Public R&D spending of EU MS (2008)
14%
12% 69%
Figure 4-23:
64%
R&D investment into GHG emissions reduction technologies by source of funds (2008)
Source: IPTS Note: No estimates for EU FP7 funding into conventional engines
74
GHG-TransPoRD D1
4.2
Air transport
The overall R&D investments in air transport in 2008 (civil aeronautics only) have been estimated to reach some €5.7 billion, out of which around €1.9 billion (i.e. 33%) have been allocated for reducing GHG emissions. Table 4-13:
Approximate R&D investments in civil aeronautics (2008) Corporate R&D investment (€m)
Civil aeronautics
Out of which for reducing GHG emissions
4,750 Turnover: €62.5bn R&D intensity: 7.6% 1,500
Public EU FP7 (€m, avg per year) 350
160
Public MS R&D (€m) 620
~250
Total R&D investment (€m) 5,700 (17% from public funds) ~1,900
Source: IPTS (rounded numbers) Note: Corporate R&D investments refer to own-funded research Corporate figures are based on the analysis of 20 key EU companies; Public MS figures are mainly derived from the AirTN project (AirTN, 2009) and completed by our country-based analysis and further sources. Due to a lack of data, no figures have been estimated for the share of public Member States R&D going to GHG emissions reduction. Nevertheless, for the sake of consistency, we roughly assumed a 40% share i.e. ranging between corporate and EU FP7 figures.
Corporate research In chapter 3, the R&D investments were related to the broad ICB category 'Aerospace and defence' that includes research activities into aerospace (aeronautics and space) and defence segments. In this section, the assessment focuses to the extent possible on the R&D investments allocated to civil aeronautics i.e. by excluding military and space-related R&D activities for the EU companies analysed. Nevertheless, note that there are important knowledge spillovers between civil and military aviation, often involving the same actors; hence, the actual innovation capacities of civil aviation are likely to be higher than indicated by the amounts of R&D investments that are allocated to this (sub-)sector. Furthermore, note that this investment is relative to companyfunded sources i.e. it does not take into account the government funding, which typically corresponds to one third of the total R&D expenditure (ASD, 2009). Resulting from the analysis of 20 EU-based companies that are key players of this sector, it has been found that the R&D spending into civil aeronautics reached around €4.7 billion in 2008, with an aggregated turnover of €62.5 billion. Despite inherent methodological differences, the latter figure is quite in line with the €58.5 billion reported by ASD (2009) for the same year (Figure 4-24). According to the same source, 5.8% of the total
Transport R&D Capacities in the EU
75
turnover of civil aeronautics was spent on R&D (company-funded) i.e. around €5.6 billion, which is of the same order of magnitude of the €4.7 billion found in the present analysis. Overall, one can estimate that the self-funded R&D investments of the EU civil aeronautics industry ranged between €5-6 billion in 2008. Aerospace & Defence Turnover: €137bn
Aerospace
Defence (land and naval) Turnover: €32.3bn
Turnover: €104.7bn
Space
Aeronautics
Turnover: €7.4bn
Turnover: €97.3bn R&D spending*: €8bn
Civil Turnover: €58.5bn R&D spending*: €5.6bn
Figure 4-24:
Military Turnover: €38.8bn R&D spending*: €2.4bn
Overall turnover and R&D spending flows of the aerospace and defence sector in 2008
Source: derived from ASD, 2009 * Company-funded R&D
About one third of this €4.7 billion has been directly invested for reducing GHG emissions. This significant amount highlights the increasing R&D efforts of the aeronautic industry into 'green' technologies, mainly driven by important R&D programmes of the main actors of the EU aviation industry (EADS, Finmeccanica, Rolls-Royce, Safran, etc.), which have committed to achieving the ambitious ACARE target of a 50% CO2 reduction per passenger-kilometre in 2020 compared to a benchmark large civil aircraft from 2000 (with sub-targets assigned to different technology areas, see annex). To meet this objective, and alongside safety improvements, the aeronautic industry has been constantly developing more fuel efficient technologies through R&D activities related to: •
Advanced engines: engine manufacturers have been developing more fuel efficient and low-emission propulsion technologies. It is the case for instance of Rolls-Royce with the TRENT 1000 and future TRENT XWB, as well as Safran with the LEAP-X63. An important objective in this area is to achieve the ACARE
63 The LEAP-X is actually developed by CFM International (50% Safran and 50% General Electric owned company).
76
GHG-TransPoRD D1
engine target consisting of a 15-20% reduction in engine fuel burn by 2020 compared to 2000 levels. •
Improved aerodynamics, weight reduction (e.g. composite materials), increased use of electrical energy, etc.
•
Increased use of alternative jet fuels: second generation biofuels suited to the aviation sector (especially Hydrotreated Vegetable Oils and Biomass-ToLiquids) are likely to play a role in the reduction of CO2 emissions of this sector in the medium term64. According to Airbus, aviation biofuels could power 30% of commercial aviation by 203065.
•
Increased air traffic management efficiency (see the SESAR programme)
The combination of these different measures will therefore help the aeronautic industry meet the ACARE's goals for 2020. There is no doubt that significant fuel consumption reduction will be achieved by new commercial aircrafts (e.g. A380 and A350 XWB), as well as in other areas (see e.g. the Bluecopter technology developed by Eurocopter (EADS) that can significantly reduce the environmental impact66). Public research We estimated that EU Member States spent around €620 million in civil aeronautic research programmes in 2008. This figure is based on data collected from national aeronautical research programmes of eleven Member States and may represent an underestimation, although the most important national programmes have been included (see e.g. AirTN, 2009 that provides a survey of national research programmes on aeronautics). Unfortunately, the share of this investment going specifically to GHG emissions reduction could not be assessed due to a lack of information. The annual average EU FP7 funds allocated to air transport (civil aeronautics) are in the order of €350 million, resulting from the aggregated funds assigned to collaborative research (TPT-AAT), the Clean Sky JTI and the SESAR JU (see chapter 2). Out of this, around €160 million (44%) has been estimated to be spent for improving fuel efficiency and reducing GHG emissions of this sector. This significant investment is due notably to the launch in 2008 of the largest ever EU aeronautic research programme Clean Sky, which strives at fulfilling the objectives fixed by the ACARE Strate64 This is analysed in detail in the WP2 of the GHG-TransPoRD project. 65 http://www.airbus.com/en/corporate/ethics/environment/alternative-fuels/ 66 www.bluecopter.com
Transport R&D Capacities in the EU
77
gic Research Agenda (SRA) (see annex). The associated research projects are targeted to reduce GHG emissions (new engines, airframe, etc.) and the environmental impacts of aircrafts and helicopters (eco-design, noise, etc.). Moreover, GHG and pollutant emissions reduction are also addressed through the SESAR programme on Air Traffic Management (Single European Sky Air Traffic Management Research). The on-going FP7 project DREAM67 is an example of key EU research programme aiming at reducing the CO2 emissions (among others) of the aviation sector. It brings together the main EU engine manufacturers and public research institutes. More details on the EU FP7 initiatives on aeronautics research are given in chapter 3.3 and in annex.
4.3
Maritime transport
The aggregated R&D investment of the maritime transport in 2008 has been found to be in the order of at least €870 million, of which 35% were funded by public research. Table 4-14:
Approximate R&D investments in maritime transport (2008) Corporate R&D investment (€m)
Maritime transport
Out of which for reducing GHG emissions
570 Turnover: €16.5bn R&D intensity: 3.4% 300
Public EU FP7 (€m, avg per year) 45
20
Public MS R&D (€m) 260
~100
Total R&D investment (€m) 870 (35% from public funds) ~420
Source: IPTS (rounded numbers) Note: Corporate funding based on the analysis of 14 key EU companies; Public MS R&D investment is taken from the Waterborne TP Strategic Research Agenda Implementation Plan (WATERBORNE TP, 2007; see also the MARTEC survey on national research programmes). Due to a lack of data, no figures have been estimated for the share of public Member States R&D going to GHG emissions reduction. Nevertheless, for the sake of consistency, we roughly assumed a 40% share.
Corporate research The level of the EU-based maritime industry R&D investment in 2008 was around €570 million, mainly driven by R&D activities undertaken by companies such as MAN (MAN Diesel & Turbo), Wartsila and Rolls-Royce (Rolls-Royce Marine). This figure is probably an underestimation of the real picture, essentially due to the limited number of companies covered in the present assessment. This is supported by the indication provided by the Waterborne TP implementation plan (Waterborne TP, 2007), according to 67 valiDation of Radical Engine Architecture systems http://www.dream-project.eu/
78
GHG-TransPoRD D1
which €1.5 billion are spent on basic and industrial research in this transport mode (note however that R&D investments from maritime universities and research institutes are also included). Our analysis shows that more than half of the total R&D spending in 2008 has been allocated to improve the energy efficiency of ships and then reduce their GHG emissions (CO2 emissions but also important reduction in NOx and SOx emissions have been achieved, notably for meeting future regulation on ship emissions). This elevated amount stems from the increasing R&D activities of the EU marine industry in key research areas such as: •
Improvement of the energy efficiency of conventional diesel engines for commercial marine propulsion, which still power most of the fleet (i.e. two-stroke and four-stroke diesel engines). European manufacturers such MAN Diesel & Turbo (e.g. for large-bore diesel engines) and Wartsila (e.g. for common-rail technology) are examples in this domain.
•
The use of gas turbines (running on LPG) is a promising option to significantly reduce CO2 and air pollutant emissions in the longer term (e.g. with combined cycle gas turbine systems), compared to conventional diesel engines. For instance, according to Rolls-Royce, the Bergen K gas engine running on LPG produces up to 90% less NOx and 20% less CO2 than an equivalent diesel engine (it also offers weight and space advantages).
•
Further significant CO2 emissions reduction can also be achieved through the development of biofuels (bio-oil), multifuel engines (gas/bio-oil), waste heat recovery, electrification, fuel cells (see e.g. Wartsila), etc.
Public research The total public R&D funding is relatively elevated and accounted for 35% of the total R&D investment of this sector in 2008. Due to the very limited number of data available, the public funding from Member States in the maritime sector (€260 million per year, on average) is taken from the Waterborne TP Implementation Plan (Waterborne, 2007), which is partly derived from national R&D programmes analysed in the frame of the MARTEC project (MARTEC, 2007). Unfortunately, the contribution of this amount towards GHG emissions reduction could not be estimated.
Transport R&D Capacities in the EU
79
Public EU funds through FP7 have been estimated to reach some €43 million68 (average per year) out of which €18 million are directed to reduce GHG emissions. As an example of key FP7 project, the HERCULES ß project (FP7, €26 million over 3 years duration) was launched in 2008 as a follow-up of the former HERCULES (High Efficiency Engine R&D on Combustion with Ultra Low Emissions for Ships)69 project ended in 2007. It is steered by the two major EU engine manufacturers, namely Wärtsilä and MAN Diesel and brings together 32 partners across Europe. One of the main objectives of this project is to reduce fuel consumption of marine diesel engines by 10% by the year 2020 and move towards ultra low exhaust emissions (70% NOx and 50% PM emissions reduction) from marine engines by the year 2020 (compared to 2000 level). As an example of a key national initiative in this domain, the 'Green Ship of the Future'70 programme was launched in 2008 in Denmark (25 Danish companies are involved) with the aim to significantly reduce the environmental impact of shipping through innovation.
68 Waterborne TP (2007) estimated an annual average of around €70 million. 69 http://www.ip-hercules.com/ 70 http://www.greenship.org/
80
GHG-TransPoRD D1
4.4
Rail transport
The overall R&D investment in rail transport has been found to be at least €1.1 billion in 2008, out of which roughly €220 million were spent to improve the fuel efficiency of railways vehicles and reduce GHG emissions. Table 4-15:
Approximate R&D investments in rail transport (2008) Corporate R&D investment (€m)
Total rail research
Out of which for reducing GHG emissions
845 Turnover: €20bn R&D intensity: 4.3% 170
Public EU FP7 (€m, avg per year) 20
Public MS R&D (€m)
5
240
~50
Total R&D investment (€m) 1,100 (23% from public funds) ~220
Source: IPTS (rounded numbers) Note: Corporate funding based on the analysis of 15 key EU companies; Public MS figures are mainly derived from ERRAC surveys (see e.g. ERRAC, 2008) and completed by further sources. Due to a lack of data, no figures have been estimated for the share of public Member States R&D going to GHG emissions reduction. Nevertheless, for the sake of consistency, we roughly assumed a 20% share i.e. ranging between corporate and EU FP7 figures.
Corporate research Around €850 million has been spent in R&D by the rail industry in 2008. The level of corporate R&D investment presented here is derived from the analysis of 15 EU-based companies undertaking significant R&D activities in this sector (note that rail-related research activities carried out by Siemens and Alstom represents by far the largest R&D contribution, followed by several EU rail suppliers). Due to the low number of EU companies analysed, this R&D investment is an underestimation. Out of this €850 million, it was roughly estimated that €170 million (20%) were targeted at reducing GHG emissions, mainly resulting from important R&D programmes undertaken by Alstom and Siemens, which are the largest EU investors of this sector. Despite the fact that rail transport is already a very efficient mode, the improvement of energy efficiency (electric or diesel trains) is a key issue for this sector. For instance, R&D activities on new generation of very high speed trains (e.g. AGV for Alstom based on articulated carriages and a distributed drive system; Velaro for Siemens) are becoming more environmentally performant. R&D programmes are also related to new generation of tramways (e.g. Citadis for Alstom), regional trains (e.g. Coradia diesel or electric from Alstom), locomotives, signalling, etc.
Transport R&D Capacities in the EU
81
More generally, the main research domains in which the EU rail industry has been investing for reducing the GHG emissions are: • Improve the energy efficiency of diesel locomotives (passenger and freight services) and diesel railcars (passenger service only). Research is often derived from R&D in other areas that can be transferred to the rail sector such as truck engine R&D (see e.g. the GREEN project71). • Energy regeneration braking systems: regenerative brake-related technologies can save important amount of energy (see e.g. the HESOP project with Alstom) • Development of hybrid or dual mode (ability to function on both electrified and nonelectrified rail tracks) technologies. • Weight reduction, improved aerodynamics (e.g. shape optimisation by CFD72 and wind tunnel). • Improve the energy efficiency of auxiliaries e.g. heating, air conditioning, lighting. Public research Overall, the assessment of the total level of public funding in 2008 in rail research suffers from a lack of available data at the time of the present analysis. According to our estimates, the level of public MS R&D investments has reached some €260 million in 2008. This amount is mainly derived from the survey carried out by the ERRAC platform on national rail research programmes (ERRAC, 2008) and complemented by further sources. It is based on the analysis of only eleven Member States, thus leading to an underestimation of the actual situation. The R&D investments going specifically to reducing GHG emissions could not be estimated due to a lack of data. EU public funding under the FP7 programme has been estimated to reach at least €20 million per year (on average), out of which around 20% is dedicated to GHG emissions reduction. EU FP projects such as Railenergy73 (under FP6) or the recently launched CleanER-D project74 (FP7) are examples of key research programmes aiming at reducing the environmental impact of the rail sector.
71 GREen heavy duty ENgine http://green.uic.asso.fr/ 72 Computational Fluid Dynamics 73 http://www.railenergy.org/ 74 http://www.cleaner-d.eu/
82
GHG-TransPoRD D1
4.5
Key outcomes from the bottom-up analysis
Even though the bottom-up approach applied in this chapter leads to uncertainties in the quantification of R&D efforts, its results have been confirmed by other studies to the extent possible and allow drawing a number of conclusions: • All modes dedicate an important part of their R&D efforts to technologies that reduce emissions of GHG, taking into account investments both from industrial and public funders. For the road sector, this part has been estimated to be around one third (increasing to more than 40% if including also technologies to reduce the emissions of air pollutants). It is also around one third in aviation, but this figure may include some R&D focusing on other environmental issues, such as reduction of noise or air pollutant emissions. For rail, the part is more limited (20%), whereas it is higher for maritime transport (48%). Yet, the different nature of R&D efforts in the various modes, with e.g. aviation by definition having a high need to focus on security, and the differences in the level of spillovers from other (sub-)sectors, e.g. between civil and military aviation; road freight and rail transport etc., do not allow for a direct comparison of the results between modes. • For the automotive sector, a further breakdown of research efforts into three technology groups has been performed. From this it becomes obvious that within the GHG emission reduction R&D efforts, and herewithin focusing on engine technologies, the largest focus of industrial research lies on the optimisation of conventional internal combustion engines. Electric vehicles (including hybrids) are the most relevant field of developing non-conventional engine technologies. Fuel cell vehicles and biofuels show comparably lower industrial R&D investment. • An extension of the analysis of the automotive industry's innovation efforts to the year 2009 indicates that both turnover and R&D investments have been detrimentally influenced by the economic downturn, yet with R&D investments decreasing at a slower pace. This may indicate that car and truck manufacturers perceive R&D as strategically important area. At the same time, however, the increasing price pressure implies a concentration on fewer technologies with a shorter expected returnon-investment. There are also indications of green technologies becoming relatively more important in the industrial R&D portfolio.
Transport R&D Capacities in the EU
83
• The role of public R&D investments (both from Member States and EU FP7 funds) is very heterogeneous between the different transport modes. While it is comparably low in the automotive sector (2.5% of the total) as a whole, which is also due to the fact that the total investments of this sector are the by far most elevated of all modes, its role is much more pronounced in other modes. Public funds account for 17% for aviation, 23% for rail and 35% for maritime. • The weight of public R&D funding (EU FP7 and Member States) also seems to depend on the maturity of the technology; this would be supported by the finding that public support account to some 2% of the overall R&D investments dedicated to conventional engines and 6% for electric vehicles, but 31% for biofuels and up to 36% for fuel cells, with the latter being considered as the technology that will take most time until its wide-spread market uptake.
84
GHG-TransPoRD D1
5.
RESULTS III – Outcome of the patents analysis
Although there is an established literature on the analysis of patents as one of the few quantitative indicators of R&D activity and technology development, there have been few applications to transport. For the EU, Oltra and Saint Jean (2009b), and INPI (2006) have studied patent activity in French car manufacturers, showing that most patenting activity still addresses conventional vehicles with petrol or diesel engines. The patent analysis was undertaken using the PATSTAT patent database. Search strategies by category were defined by relevant technology category for fuel cells, hybrid and electric vehicles and biofuels. Data is available for the years 1990 to 2007. The analysis was undertaken for European firms, defined as firms with their headquarters in the EU. The automobile industry is however a global industry, with the major firms selling their vehicles across the world. However, product development tends to be concentrated in the country of origin of the multinationals. Therefore, this analysis presents a good assessment of the patenting activity of European based firms. The relative competitive position of European firms versus other international firms is not addressed.
5.1
Dynamics of patent applications
First, the dynamics of patent applications for each technology was examined for international patent applications in the period 1990-2007, the last year for which reliable data are available. While an increase in the number of patent applications can be observed for all three technology fields, there are large differences in the relative change (dynamics) for each field. Inspection of Figure 5-25 reveals that the largest relative increase was seen for fuel cells, followed by hybrid and electric vehicles and biofuels. There were more than 28 times more patent applications in fuel cells in the year 2007 compared to 1990. This same ratio was slightly above 6 for hybrid and electric vehicles and slightly below 2 for biofuels. The timeline in Figure 5-25 also reveals that the increase in fuel cell patent applications occurred mostly in the 1990s and has largely stagnated since then. By comparison, patent applications in technologies pertaining to hybrid and electric vehicles largely stagnated in the first half of the 1990s but have increased strongly for most of the current decade. I.e. using an index with the base year 2000, would reveal these shorter term dynamics that differ from the long-term dynamics since 1990. The patent activity for biofuels followed a generally upwards trend over the period of investigation, even if this trend was not as steep as the other two.
International patent applications (indexed, 1990 = 100)
Transport R&D Capacities in the EU
85
10000
1000 fuel cells hybrid‐electric 100
biofuels
10 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007
Figure 5-25: International patent applications (PCT+EPO, overlap excluded) pertaining to the three selected technology fields. For comparison, the number of international patent applications was indexed for all technology fields, with the number of patent applications in the year 1990 corresponding to an index of 100. Note the logarithmic scale for the vertical axis. Source: ISI, resulting from technology specific search strategy of international patents, excluding overlaps
Because the absolute number of patents pertaining to hybrid and electric vehicles is more than a factor of two larger than that for fuel cells (with biofuels ranging between them), we may summarily assess the dynamics of patent applications as follows: • The largest field and currently most dynamic technology field in the sample is hybrid and electric vehicles. Not only is the absolute number of patent applications the largest of the three but the indexed and absolute increase in patents in the very recent years is considerably larger than that in the other two technologies. This reflects a focusing of the efforts of technology developers in electromobility. • Mobile fuel cells have seen the largest relative increase in patent applications in the timeframe considered, but the number of patent applications has stagnated or decreased in recent years. Furthermore, the absolute number of patent applications is the smallest of the sample. However, the number of new applications has remained fairly stable at a level significantly higher than at the beginning of the timeframe, indicating ongoing efforts to bring this technology into the market. • Technologies pertinent to biofuels have experienced a slow but steady increase in patent activity.
86
GHG-TransPoRD D1
These findings are underlined by the keyword-based patent research undertaken. Figure 5-26 shows the yearly aggregated number of patent applications on electric vehicles of the main EU actors over the period 1990-2009. The steep increase in patent applications from the principal EU-based automotive manufacturers and suppliers on electric vehicles (including hybrids) becomes obvious. This hints at the rapidly growing importance paid by industry to the development of these technologies in recent years, supporting the conclusion of the technology's importance that was drawn from the assessment of R&D investments above. It indicates that the number of patent applications has been multiplied by 4 between 2006 and 2009, meaning that research in electric vehicles has become a higher priority for EU-based companies today. 500
Number of patent applications
450
Electric vehicles (incl. hybrids)
400
Fuel cell vehicles
350 300 250 200 150 100 50 0 1990
Figure 5-26:
1995
2000
2005
2010
Annual number of patent applications related to electric vehicles and fuel cell vehicles from the EU automotive industry over the period 1990-2009
Source: IPTS, resulting from a keyword-based search, following the methodology of Oltra and Saint Jean (2009a)
5.2
Patenting activity by country
As a second step, the number of international patent applications (in each of the technologies considered) coming from the EU was broken down into the individual Member States. Because of possible large fluctuations in the year-to-year patent applications, the patent numbers were aggregated into four four-year periods spanning from 1992 to 2007. This breakdown is shown in Figure 5-27, Figure 5-28, and Figure 5-29 for hybrid and electric vehicles, mobile fuel cells and biofuels, respectively.
Transport R&D Capacities in the EU
87
5.2.1 Hybrid and electric vehicles In the case of hybrid and electric vehicles (Figure 5-27), a clear and sustained dominance of German patents was observed, starting at 50% of pertinent European patenting activity in the period 1992-1995 and increasing to slightly over 60% in the period 2000-2007. At the same time, France saw a slight increase in its share of pertinent European patent applications from 14% in the period 1992-1995 to 18% in 2004-2007. In contrast, the number of pertinent patent applications from Italy, Great Britain and Sweden increased only half as much (on a percent basis) compared to France and Germany in the same period. This, combined to growth in the rest of the EU27 (comparable to the overall growth in pertinent European patents) led to the share of Italy, Great Britain and Sweden to decline from a collective 28% in the period 1992-1995 to a collective 12% in the period 2004-2007. The share of the other EU27 countries has remained essentially stable. DE
2004‐2007
FR IT
2000‐2003
GB SE
1996‐1999
AT NL
1992‐1995
FI 0%
Figure 5-27:
20%
40%
60%
80%
100%
RoEU27
Breakdown of European patents pertaining to hybrid and electric vehicles, differentiated by country
Source: ISI, resulting from technology specific search strategy of international patents, excluding overlaps
5.2.2 Mobile fuel cells In the case of mobile fuel cells (Figure 5-28), European patenting activity is also dominated by German patents, but with a different trend: an overall decrease in the German share in pertinent European patents from 65% in the period 1992-1995 to slightly over 50% in the period 2004-2007. The trajectory of this change, however, was not linear. In the period 1996-1999, Germany accounted for over 70% of European mobile fuel cell patents. Since then, this share went down to 65% in 2000-2003 (same level as 19921995) and finally to slightly over 50% for 2004-2007.
88
GHG-TransPoRD D1
2004‐2007
DE FR
2000‐2003
GB IT
1996‐1999
DK NL
1992‐1995
SE RoEU27 0%
Figure 5-28:
20%
40%
60%
80%
100%
Breakdown of European patents pertaining to mobile fuel cells, differentiated by country
Source: ISI, resulting from technology specific search strategy of international patents, excluding overlaps
A similar decrease, though at a lower absolute level, can be observed for Great Britain: its share in relevant patents decreased from 16% in the period 1992-1995 to 10% in the period 2004-2007. In contrast, France steadily and significantly increased its share from 2% in the period 1992-1995 to 13% in the period 2004-2007. Similarly, Italy and Denmark have increased their share, though both remain under 10% of pertinent European patents each. The share of the other European countries remained essentially unchanged (~10%) when comparing 1992-1995 to 2004-2007, with lower shares in 1996-2003. It is worth mentioning that the number of patent applications in this technology field decreased by approximately 15% when comparing the periods 2004-2007 and 20002003. Behind this absolute decrease is the large decrease (> -30%) in patent applications coming from Germany. Great Britain and the Netherlands also had negative growth in patent applications. At the same time, there were more patents coming from all other EU countries in the same period of comparison.
5.2.3 Biofuels In the case of biofuels (Figure 5-29), the dominance of German patent applications is less marked than it was for hybrid and electric vehicles and mobile fuel cells, and has decreased considerably since 1992-1999. Whereas Germany submitted over 40% of European patents in this technology field between 1992 and 1999, this share decreased to slightly below 40% in 2000-2003 and approximately 30% in 2004-2007. In
Transport R&D Capacities in the EU
89
this same period, the share of patent applications coming from France also decreased, albeit at a lower absolute level. In contrast, both Great Britain and the Netherlands have moderately increased their share in European patent applications on biofuels, from 14% to 18% and from 10% to 14%, respectively, considering the periods 1992-1995 and 2004-2007. The share of the rest of Europe has increased considerably from the period 1992-1995 to 2004-2007, with most of that increase taking place in the last four-year period. DE
2004‐2007
GB NL
2000‐2003
FR IT
1996‐1999
BE ES
1992‐1995
FI 0%
Figure 5-29:
20%
40%
60%
80%
100%
RoEU27
Breakdown of European patents pertaining to biofuels, differentiated by country
Source: ISI, resulting from technology specific search strategy of international patents, excluding overlaps
5.3
Snapshot of patenting activity by company
The previous section revealed the dominant or at least prominent position of Germany in all three technology fields. France, Great Britain and Italy were also identified as very important patenting countries in all three technology fields, while the Netherlands has a strong position in the technology field of biofuels. In this section, we investigate the positioning of companies and organizations as patent applicants, regardless of where in the EU the patents were produced. Furthermore, we compare the patenting activity of each company to its overall patenting activity in order to approach the question of specialization. To do this, a multistep procedure is needed as outlined in Figure 5-30. This procedure was applied to all three selected technology fields for the year 2007.
90
GHG-TransPoRD D1
Figure 5-30:
Workflow for identifying applicants in each technology field and for ascertaining the share of relevant patent applications compared to the total patent applications for each applicant.
5.3.1 Hybrid and electric vehicles A total of 91 companies were identified to have applied for a patent in the last year of data (2007) in the relevant IPC classes. The distribution of patents by applicant is shown in Figure 5-31, and shows that six companies account for more than half of all patent applications. Of these six, the by far largest applicants were Bosch (19%) and ZF (13%), both large German suppliers of car components. The second group of large applicants in this technology fields is composed of three car manufacturers and one supplier of components: Renault (7%), Daimler (6%), Peugeot and Siemens (4% each). In addition to these large applicants, 85 companies/institutions contributed each 3% or less to patent applications relevant to hybrid and electric vehicles. Their combined patent applications account for slightly less than half of relevant patent applications.
Transport R&D Capacities in the EU
74 Companies
