Measuring & Control Technology in Europe

Measuring & Control Technology in Europe

The purpose of this presentation is to:

– Demonstrate the importance of the European Union – the world's largest singlemarket

– Outline its future dimensions as it expands towards the east

– Describe the present status and future prospects for measuring & controltechnology within this market

– Explain why Baden-Württemberg is the ideal location from which to serve themeasuring & control technology market – Europe wide

In the last two decades, the sharp contrasts between the Western and the Eastern European countries have been fading and the European Union is the major driver for Europe’s integration.

Since May 2004, Poland, the Czech Republic, Slovakia, Hungary, Slovenia, the Baltic States, Cyprus and Malta are members of the European Union. In 2007, Romania and Bulgaria are expected to join the EU.

European integration opens up a vast market for your company with untold market opportunities.

Europe is expanding towards the East

Source: German Federal Statistics Office, EUROSTAT, OECD (2003)

EU Members (since 2004)Potential EU-members in 2007

European UnionPopulationArea (km2)GDP (Euro)

453 m3 891 m

9 714 bn

Eastern Europe (non-EU)

90m581m

173bn

PopulationArea (km2)GDP (Euro)

(excl. Russia)

The leading Markets in EuropeIn 2003, the 25 member states* of the European Union had a total Gross Domestic Product of Euro 9 714 bn, exceeding the GDP of the USA (Euro 9 710 bn) and Japan (Euro 3 817 bn).

Four of the member states – Germany, Italy, France and the UK – are among the six largest economies of the world. Of these, Germany has the highest GDP, the largest population, and the highest purchasing power.

Within Germany, the State of Baden-Württemberg, Germany`s southwest, is one of the most prosperous and innovative regions.* including new members from May 2004

Source: German Federal Statistics Office, EUROSTAT, OECD (2003)

IS

GB

DK

S

FINN

NL

F

E

PI

AUTCH

B

IRL

GR

SLOH

SKCZ

D

BG

RO

UA

PL

BYLT

EWLV

RUS

Dimension of total GDP

The right Location for Growth and Prosperity

Baden-Württemberg is already the most highly industrialized and one of the most prosperous regions in Germany.

Its proximity to important markets – east and west – makes it an ideal location for pan-European activities.

And it has further merits:

– It has a highly developed infrastructure – suppliers, R&D facilities, business services.

– Its workforce is well trained, innovative and productive.

– Its companies have an established export orientation and know how to penetrate new markets.

It is set to succeed in the 21st Century.

Germany‘s Southwest:Baden-Württemberg

Stable Growth in the European Measuring & Control Market

Between 2000 and 2002 , production increased by an average of 3.3% annually. Experts predict an average annual growth rate of 4.8% in the coming years. The driving forces behind this growth are:

– Technological innovations in the user industries

– Rationalization and quality cons-ciousness

– New applications resulting from environmental legislation

– Wider acceptance of EU-norms

EU Production in the Measuring & Control Sector (in billion €)

28.1

2000

32.8

2005*

* Forecast

Source: Association of Precision Engineering and Optics Manufacturers, figures from 2002

Stable Growth in the European Measuring & Control Market

In 2002 total sales of German

manufacturers amounted to € 19.73 billion.

From 2001 to 2002 sales per employee grew from € 134 900 by an average of 3% per year - evidence of the steady increase in productivity.

Sales of German Manufacturersin theMeasuring & Control Sector (in billion €)

19,9 20.5 19.721.2

23.425.7

2000 2001 2002 2003 2004* 2005*

* Forecast

Source: Association of Precision Engineering and Optics Manufacturers, figures from 2002

A Foothold in Germany ensures Proximityto Industrial Customers

Four countries account for 74% of total EU industrial production. Germany is easily the leader with30% of manufactured goods, France is in second place with17% of total output, followed bythe Italy and UK with 13.6% and 13.4%.

For a producer of Measuring & Control Technology, a foothold in Germany ensures close proximityto a large number of customersand suppliers.

The Manufacturing Industry Share of National Economy (in %)

Source: Eurostat

20% to 40%

20% to 15%

< 15%

Germany – An important Global Trade Partner

Export sales amounted to € 10.86 bn. The other EU countries and Asia are the most important export markets.

Exports to the „Rest of the world“have increased significantly, evidence of the continuing globalization in this sector.

Germany‘s trade flows in Measuring & Control Equipment in % of total Imports/Exports in this Sector

North America

14.3%

22.5%

European Union

47.5%

29.4%

CentralEasternEurope

8.4%

7.2%

Others29.8%

40%

Source: Association of Precision Engineering and Optics Manufacturers, figures from 2002

Eastern Europe is important Target for German Exports

German exports to Eastern Europe in the measuring and control sector reached 8.4% in 2002. This is an increase of 3.2% compared to the year 2001.

Growth rates in the different Eastern European countries vary - for example exports to Poland and Czech Republic grew by about 24% between the years 2000 and 2001.

German Exports to Eastern Europe in theMeasuring & Control Sector (in million €)

1.168

1.470

2000 2002

Source: Association of Precision Engineering and Optics Manufacturers, figures from 2002

The Eastern European Market is growing in Importance

Eastern European companies know that to sell in the West, they must produce better quality goods. The introduction of new measuring and control technology is seen as an essential:

– Equipment is obsolete

– Processes are inefficient

– Productivity and quality are below Western levels

Funds to finance modernisation are being made available:

– Donor organizations are funding restructuring projects

– Foreign investors are bringing in capital

The market for measuring and control technology and industrial automation is therefore expected to grow by 7.5% to 8.0% p.a.

Eastern European Market for Measuringand Control Technology (in million €)

3.1004.100

1998 2005*

* forecast

Source: Association of Precision Engineering and Optics Manufacturers, figures from 2002

Growth Opportunities in the EU

– The market is growing and will increase further

– High quality, high-tech products are particularly in demand

– There is room for new market entrants among the widerange of specialized producers

– EU norms and standards are not a hurdle, but an opportunity to serve an ever-expanding market

Measuring & Control Technology in Baden-Württemberg

– Of the 45 000 companies in the EU in fiveimportant sectors of industry: Electronicalengineering, Mechanical engineering, Motor vehicle construction and parts, Precision machinery and optics and Office machines 11 724 – 26% – are in Germany.

– Within Germany, 24% of the companies in these sectors are in Baden-Württemberg.

Measuring & Control Technology in Baden-Württemberg

Mobility

Health Care

EnvironmentalTechnology

Industrial ProcessTechnology

T.I.M.E.(Telecom, IT, Media,

Electronics)

Measuring & Control (M&C)

Equipment

The Measuring & Control Equipment Industry is an important supplier to all of the 5 most important cluster industries in Baden-Württemberg.

In Baden-Württemberg, all relevant industries are present in great density – one of the few regions worldwide that offers this advantage.

Baden-Württemberg – Germany‘s most industrialisedState

> 30%

25% to 30%

18% to 25%

< 18%

Source: German Federal Statistics Office

The Manufacturing Industry‘s Share of National Economy (in%)

The measuring and control industry draws on all the high-tech skills of the modern age: mechanical engineering, electronics, vehicle construction, precision machinery and optics – and needs high-quality suppliers.

Within Germany, 24% of the companies in these sectors are in Baden-Württemberg.

With its industrial density and dedication to quality, Baden-Württemberg is the ideal location for companies in the measuring & control equipment market.

Companies

Baden-Württemberg –An excellent structure for higher education

Baden-Württemberg has the most densiestand the most modern structure of Universitiesand Academies for higher education, including

– 9 Universities

– 37 Universities of Applied Sciences

– 6 Universities of Education

– 9 Universities of Arts

– 9 Vocational Academies

– 7 Private Universities

A network of technology transfer centers provides the bridge between private industry and research institutes and guarantees rapid access to new results.

Baden-Württemberg –A highly developed Research Infrastructure

The State provides a unique research infrastructure consisting of

– 3 large-scale research institutes

– 13 Max-Planck-Institutes

– 15 Fraunhofer Institutes

– 8 contract research institutes at Universities

– 10 institutes of joint industrial research.

Baden-Württemberg –Good access to the East and the West

BrusselsBerlin

PragueBudapest

Milan

Paris

London

Istanbul

Stuttgart

Moscow

Rome

MadridLisbon

Athens

Copenhagen

Helsinki

Distance in km flighttime

Berlin 500 1hr/10

Brussels 410 1hr/10

Budapest 740 1hr/30

London 730 1hr/45

Milan 360 1hr

Paris 510 1hr/15

Prague 400 1hr

Istanbul 2170 4hrs

Moscow 2070 5hrs

Rome 810 1hr/40

Madrid 1380 2hrs/25

Lisbon 1840 2hrs/50

Athens 1690 3hrs/35

Copenhagen 800 1hr/50

Helsinki 1840 2hrs/50

Baden-Württemberg –One of the World‘s leading Exporters

Baden-Württemberg accounts for only0.17% of the world´s population and for an impressive 1.7% of total worldexports. This is 16% of total German exports.

Baden-Württemberg yearly exports €103 billion worth of goods. With a per capita export volume of € 9732 Baden-Württemberg outstrides all otherGerman States.

Exports account for more than 33.7% of the State´s GDP, making Baden-Württemberg Germany´s No. 1 exporter.

2 366

3 016

5 369

6 617

7 878

8 272

9 732

USA

Japan

Hesse

North Rhine-Westphalia

Germanaverage

Bavaria

Baden-Württemberg

Per capita export volume in €

Sources: German Federal Statistics Office; World Bank, figures from 2002

Baden-Württemberg Facts & Figures

Gross domestic product (GDP)

Expenditure on R&D

Patent applications per year

Number of manufacturing plants

Export quota (manufactured products)

Value of exports

Foreign Direct Investment (cumulative 1955 – 2001)

Population

Research facilities

University, technical and vocational college students

Euro 307 billion

Euro 11.9 billion = 4% of the State’s GDP

> 12 822 = 25% of German total

9 026

43.1%

Euro 104 billion = 1.35% of the World’s exports

Euro 55.8 billion

10.7 million inhabitants

> 100 major research institutes

217 000

Services provided by Baden-Württemberg International

Baden-Württemberg International is your central port of call if you are looking for a location or a Baden-Württemberg partner with whom to establish fruitful business relations. Our range of servicesincludes:When you are looking for an industriallocation:

– Information on Baden-Württemberg and on individual industrial sites.

– Consulting on government subsidies and programs.

– Assistance with all contacts to authorities, including permit procedures.

– Support in the search for suppliers and the selection of service companies.

When you are looking for cooperationpartners:

– Information on market potential and market specifics.

– Planning of information visits, includingappointment scheduling.

– Identification of potential partners thatmeet your specific demands.

– Assistance with trade fair activities in Baden-Württemberg.

Baden-Württemberg International Willi Bleicher Strasse 19, D -70174 Stuttgart

Phone: ++49-711-2 27 870 • Fax: ++49 711 2 27 87 22Internet: www.bw-invest.de • E-Mail: info@bw-i.de