Nearly every car built in Germany includes a component made in the eastern state of Saxony-Anhalt, which is home to around 250 companies supplying both domestic and global car manufacturers.
Investment is growing, reaching almost 1.58-billion Euros in 2010 – the highest level in four years. The state government offers a number of subsidies - 30% for large companies, up to 40% for mid-sized firms, and up to 50% for small companies. It is estimated that the subsidies have helped create over 16 000 jobs. First stop for investors is the state-owned Economic Development Agency of the German Federal State Saxony-Anhalt (IMG). Another strength is the 250-strong MAHREG Automotive association. Founded in 1999, it is a network of excellence, service providers, equipment suppliers, research institutes and universities.
Automotive Industries (AI) asked Carlhans Uhle, CEO of IMG, what were are some of the benefits for automotive companies doing business in the state.
Uhle: Only Saxony-Anhalt combines the advantages of doing business in Western Europe and those advantages of doing business in Eastern Europe. Saxony-Anhalt offers easy access to growth markets, reliable infrastructure, ideal conditions for acquisition and sales in Germany and Europe, an efficient and innovative industrial location with high technological standards and high quality of life. Saxony-low operational costs, and has a well trained and flexible work force within a stable political and legal system. Saxony-Anhalt has the highest productivity in Eastern Germany. The supplier industry works closely with the state scientific institutions - which paves the way for close R&D collaborations. The federal state also convinces with its rapid approval procedures and fast project realization thanks to the support of the authorities and the ministries.
AI: Please tell us about the research and development infrastructure in the state.
Uhle: The various universities and institutes accumulate know-how throughout Saxony-Anhalt and closely collaborate with the industry. The Otto-von-Guericke University for instance focuses on three pillars of automotive research: energy conversion and drive systems, safety and comfort and virtual engineering. The Fraunhofer Institute for Factory Operation and Automation IFF with the Virtual Development and Training Centre (VDTC) is another important partner, and focuses on conceiving, engineering and producing innovative and customized solutions in fields such as logistic and material handling engineering and systems, robotic systems and measurement and testing technology; and digital engineering and virtual-interactive training. The Creativity and Competence Center Harzgerode (CCC) with its testing facilities for the metal processing industry is another key player for the research and development infrastructure of the automotive industry. It offers a demonstration laboratory aluminum die casting with automated die casting cell and high quality laboratory equipment for the analysis and evaluation of components, forms and materials. The Powder Metallurgy Competence Center Thale (PMC) for the highly innovative manufacturing of metallic ferrous and non-ferrous components, “InnComposites,” as well as the Innovation Center for Fiber Composites, and the Fraunhofer Institute for Mechanics of Materials (IWM) are also located in the state. With the recently established Institute of Automotive Expertise IKAM, Saxony-Anhalt
is taking a pioneering role.
AI: How will IKAM benefit the industry?
Uhle: This research institute, established by the state, the Otto-von-Guericke University in Magdeburg and business representatives, is intended to bring together all phases of innovation under one roof through close cooperation between business and science: from basic research and application-based processing of new insights to industrial research. In November 2010, four laboratories were inaugurated. Another eight are to follow until 2012. Through this collaboration, we can together continue to successfully build research skills in the field of automobiles. We already have the most modern drive train test benches for hybrid and electric vehicles which provide us with undreamt of opportunities for testing. No other sector will face such profound upheaval in the coming years as the automobile and supply industry, due to the introduction of new propulsion methods and concepts for vehicles.
AI: What is the symbiotic relationship between the aluminum and auto industries?
Uhle: Saxony-Anhalt is a heavyweight in lightweight construction, so to speak. The automotive suppliers set the bar within the competence cluster “Aluminium – Alloy Development and Innovative Casting Processes” with the ACOD Automotive Cluster of Eastern Germany. In the light of the special strengths and experience in light-metal casting, the ACOD has given the MAHREG Automotive cluster the lead role in research and development for the use of aluminum in vehicles.
The AL-CAST vision is to achieve a leading position of the aluminum casting suppliers for the automotive industry in Europe in the short and medium term. For the strategic target markets - Automotive and target markets in other industries as e.g. aviation, railway and high-quality sports equipment – AL-Cast is in a good position.
AI: What are some of the most important automotive investments made in Saxony-Anhalt?
Uhle: Thyssen Krupp Presta is one of the world's most successful manufacturers of steering systems and forging, and has set up two subsidiaries in Saxony-Anhalt. The company produces camshafts in Ilsenburg for 17 engine factories world-wide. In November 2010, the company started building a new production hall. The production is planned to start in May 2011, expanding annual output of eight million camshafts to 10 million. The company plans to build another production hall in 2012/2013. THYSSENKrupp Presta SteerTec Schönebeck – another subsidiary in Saxony-Anhalt – has been producing steering systems since 1999.
Korean company Mobis Parts Europe has had its Germ regional office at Sandersdorf-Brehna for the past three years. The largest Korean company for the sale and export of car spare parts supplies central warehouses in several European countries from the commercial zone in the vicinity of the Schkeuditz motorway junction. All German Kia and Hyundai dealers are directly served from Brehna. The Brehna-based Mobis Parts branch office also supplies 14 countries with parts for the automobile brand Kia, and 15 countries for Hyundai.
The Recticel Automobilsysteme is part of the Belgian Recticel Group, a manufacturer of polyurethane foams operating in Europe, USA and Asia. The company has been producing interior components based on polyurethanes for major automotive companies in Saxony-Anhalt since January 2005. Last but not least, FEV Dauerlaufprüfzentrum in Brehna started operations in 2007 with 31 engine and power train test benches. Today, it is the most modern test center for durability tests of engines and power trains worldwide.
AI: How else will you promote Saxony-Anhalt as an automotive destination?
Uhle: As the future of mobility is becoming increasingly electrical this demands highly efficient vehicles that can be driven by alternative energies. Saxony-Anhalt is a world leader in the field of renewable energies. About 40% of the power required in Saxony-Anhalt is derived from regenerative sources. With SOLAR VALLEY, Saxony-Anhalt shows the strength of the industrial value chain. In the field of electric mobility Saxony-Anhalt is ahead of the game, especially in the field of batteries and its components. The foundations for more environmentally friendly mobility are being laid in Saxony-Anhalt. The state is already a trailblazer in the generation of renewable energy: Every third kilowatt hour is obtained from renewable sources; the largest amount is provided by wind energy. Storage concepts are needed to make green energy available on a longer term – and Saxony-Anhalt is working on it.
The government has also recognized the strategic importance of electric mobility. The state government has announced its goal of developing the state as a center for regenerative storage technologies. A special challenge will be storing energy in vehicle batteries when, for example, good wind conditions are present. Together with the IKAM, additional preconditions will be met in the state in order to advance electric drive and storage technologies.