Contract research: Revenue and budgeted expenditure 2015–2019

Contract research is the mainstay of Fraunhofer’s business activities and, based on the Fraunhofer funding model, consists

of three areas each contributing around one third to the organization’s finances:

– Research directly contracted by industry

– Publicly funded research projects

– Precompetitive research funded with base funding

Budgeted expenditure for the contract research segment grew by 6 percent in 2019 to reach €2295 million, of which the operating budget accounted for €2142 million and capital expenditure for €153 million. The amount of base funding used to finance precompetitive research increased by 9 percent to €746 million. Base funding is provided by the BMBF and the state governments in a ratio of 90:10. New research institutions generally receive initial funding from their host state during their first five years. Industrial revenue, at €724 million, was on a par with the previous year. Revenue from contracts with industry increased by 1 percent to €617 million, while license-fee revenue decreased by 2 percent to €107 million.

Revenue from publicly funded projects continued to increase significantly in 2019. Funding granted by the German Federal Ministry for Economic Affairs and Energy (BMWi) grew at a particularly high rate, increasing by 28 percent to €194 million. Revenue from projects funded by the German Federal Ministry of Education and Research (BMBF) increased by 7 percent to €209 million, while funding by individual states also increased by 7 percent, to €161 million. Revenue from other public sources totaled €113 million, and includes funding by foundations, universities and other institutions. EU revenue increased by 4 percent to €95 million. As a partner in the Horizon 2020 Research Framework Programme, Fraunhofer plays an active role in shaping the European Research Area and ranks third among participating research organizations in terms of research funding granted.