The 2022 edition of the EU Industrial R&D Investment Scoreboard, published by the Commission, shows that Europe’s industry is back on track in research and development investments with an increase of 8.9% in 2021 compared to the -2.2 % pandemic-related dip in 2020.
The EU remains the global leader in R&D investments by the automotive sector, where the transformation towards electric vehicles and digitalisation is fully underway in both established companies and younger firms. The Scoreboard also shows a broad sectoral diversification for the EU, especially compared to the US, where R&D investment is highly concentrated in Information and Communication Technologies (ICT).
Globally the private sector R&D investment grew strongly beyond pre-pandemic levels (by 14.8% in 2021 vs. 2020). For the first time since the 2004 Scoreboard, total R&D investment by the world’s top 2500 firms passed above one trillion euros (€1094 billion). An important change is that all Chinese Scoreboard firms together now have a slightly bigger share of the global total than the EU companies (17.9% Chinese and 17.6% EU, respectively). The leading share of US firms increased to 40.2% of the global total.
Further deepening of the global technology race
The Scoreboard highlights the intensification of the global tech race in the four key sectors which account for more than three-quarters of the total company R&D reported: ICT producers (22.6%), health industries (21.5%), ICT services (19.8%) and automotive (13.9%).
The R&D growth rates of US and Chinese companies – 16.5% and 24.9%, respectively – continued to outpace that of EU counterparts, due to the fact that US Scoreboard companies are leading R&D investors in ICT (both as producers and service providers) and health sectors, while Chinese Scoreboard firms are ahead of the EU not only as ICT producers, but also in ICT services. The number of Chinese Scoreboard companies more than tripled over the past decade (from 176 in 2011 to 678 in 2021), displacing EU and Japanese firms from more traditional manufacturing sectors.
Encouraging trends and policies
Many EU Member States have significant R&D players in sectors such as aerospace, defence and chemicals industries, in addition to the automotive, ICT and health industries. The top 1000 EU companies include a substantial number of small- and medium-sized enterprises (SMEs) in health and ICT sectors with encouraging R&D growth in 2021. This is a welcome signal for important target groups of the New European Innovation Agenda, which among others addresses scale-up and growth in emerging deep tech and breakthrough technologies and triggers spillovers between sectors with the support of the European Innovation Council. The updated Industrial Strategy also promotes innovation policies in the broad industrial base in Europe including the high-technology sectors.
A patent-based positioning of Scoreboard companies in green technologies and circular economy technologies shows that EU and US companies lead in high-value patents, and the EU also leads in inventions relevant to circularity.
The 2022 report also analyses performance in relevant UN’s Sustainable Development Goals (SDGs). EU companies achieved the highest scores in most SDGs and showed progress since last year. From a sectoral perspective, companies in the automotive and chemical sectors achieved on average high progress in SDGs. The review also reveals the high potential of deep technological solutions to tackle global challenges.
Corporate venture capital
As a new aspect of corporate innovation strategies, Corporate Venture Capital (CVC) has also been analysed. CVC has been increasing over the past 20 years and is now used by two-thirds of Scoreboard companies. R&D and CVC complement and support each other, especially in ICT and health. CVC by EU companies amounts to around half of that by US companies. Moreover, 80% of funds from EU-based companies go to US-based start-ups, which triggers important spill-overs.
The EU Industrial R&D Investment Scoreboard has been published annually since 2004 – this is its 19th edition. It provides the most recent economic and financial information based on the latest published audited accounts of the world’s top 2500 R&D investors, including the top 1000 EU-based ones.
Together with the Scoreboard, the Commission publishes the 2022 Survey on EU Industrial R&D Investment Trends. While the Scoreboard data do not yet show an impact from the war in Ukraine, the survey report mentions some early feedback such as delays of some existing R&D projects in aerospace and defence, construction, health industries and automobiles. Some companies also said that they started new R&D projects as a direct impact of the war. The 2022 Survey on EU Industrial R&D Investment Trends was sent to the top 1 000 EU R&D investors in the Scoreboard 2021 and has taken place between June and September 2022.