How do German businesses compare internationally?

German companies are among the most innovative in the world. Business-based and -financed investments account for more than two thirds of all R&D funding in Germany. Around two per cent of gross domestic product is spent on R&D by German companies.

The chart shows R&D expenditure by German companies as a proportion of GDP: 2.1 per cent.

This means they are among the top ten industrialized countries. And when it comes to researchers who work in companies, there is hardly any country with more R&D personnel.

Important role played by research

Research plays an important role for the German economy: with their medium-high technology, research-intensive industrial companies and service providers contribute more than 11 per cent to value creation in Germany. The German economy is thus specialized in the production of medium-high technology such as vehicles and mechanical engineering products to a greater extent than any other Western industrialized country.

Business R&D is international

Many German companies conduct research abroad and some even have their own global networks, such as the automotive component supplier Continental. It develops its products at 94 different locations worldwide. Or the family-owned company Boehringer Ingelheim: with 52,000 employees worldwide, this research-driven biopharmaceutical enterprise has a research and production network across the globe with central facilities in Germany, the USA, Austria, Japan, France and China.

Hidden champions

It is not only the big household names that are researching for the future, however. The “Weltmarktführer-Index” (World Market Leader Index) compiled by the HBM Unternehmerschule at the University of St Gallen in Switzerland, lists approx. 500 champions in Germany – for example, the technology enterprise ZF Friedrichshafen AG. An automotive supplier, it is one of the companies that files the most patents with the German Patent and Trade Mark Office. This is hardly surprising given that ZF Friedrichshafen spends 8 per cent of its annual turnover on research and development.

Facts and figures

Spending around 2% cent of gross domestic product on R&D, the German economy is one of the top ten internationally when it comes to business R&D.

With their medium-high technology, R&D-intensive industrial companies and service providers contribute more than 11% to value creation in Germany.

Germany is home to approx. 500 hidden champions.