Significant rise in income from industrial contracts

Press Release / 10.5.2011

The Fraunhofer-Gesellschaft is emerging stronger from the global economic crisis. Last year the finance volume increased to 1.66 billion euros and the staffing level to 18,000, with the creation of nearly 1,000 new jobs.

“The economic upswing had a positive effect on business. Last year the finance volume rose two percent to 1.66 billion euros. Even though the expiry of the programs to stimulate the economy had a negative impact, a new record level was achieved,” states Prof. Hans-Jörg Bullinger, President of the Fraunhofer-Gesellschaft, summarizing the positive trend for the year 2010.

“The finance volume comprises the current budget for contract research (the main area of research and development work), defense research and investment in new research infrastructure,” states Senior Vice President Finance, Prof. Alfred Gossner. The current budget for contract research increased by 62 million to 1.40 billion euros. “Fraunhofer generates more than 70 percent of its revenue from industrial orders and publicly financed research projects,” Gossner explains.

More income from industry

Income from projects with companies and public-sector customers reached a new record level of 1.03 billion euros. “Industrial revenue showed a distinct increase, rising by 14 percent to 463 million euros in 2010,” Gossner emphasizes. Its share of income has thus increased from 31 percent (2009) to 34 percent (2010). Income from public-sector customers showed a further increase in 2010. Fraunhofer generated 406 million euros of revenue from contract research projects for the federal and state governments.

The budget for defense research rose by seven percent last year to 93 million euros. This represents six percent of the Fraunhofer-Gesellschaft’s total finance volume. “As expected, investment in new research infrastructure, amounting to 162 million euros, was down on the record level of the exceptional year 2009 owing to the decrease in funding from the federal and state economic stimulus programs,” the Senior Vice President Finance continues. Investment outside the economic stimulus programs amounted to 140 million euros, which is about 20 percent more than in the previous year. The main infrastructure projects last year were the Fraunhofer All Silicon System Integration Center ASSID in Dresden, which opened in May, the new Chemical-Biotechnological Process Center CBP in Leuna and the expansion of the Fraunhofer Institute for Microelectronic Circuits and Systems IMS in Duisburg.

Institutional funding makes up about a third of the total. This enables Fraunhofer to develop innovative technologies over the medium term, independently of economic cycles. In fiscal 2010 the funding agencies increased the level of financial support for the major research associations by three percent. The federal and state governments have decided to continue the Pact for Research and Innovation until 2015 and to increase the annual grant by five per cent from 2011 onwards. Fraunhofer intends to use the additional funding to identify new lines of research, to strengthen cooperation and networking and to develop young scientific talent.

More than 18,000 employees for the first time

Fraunhofer created close on 1,000 new jobs last year. The number of employees rose to over 18,000. This means that the staffing level has doubled over the past ten years. “In the global competition for the best people it is a great challenge to continue to recruit the qualified staff needed to handle the constantly growing volume of research and the increasingly complex technological requirements,” emphasizes Fraunhofer President Bullinger.

The Fraunhofer-Gesellschaft is one of Germany’s top patent applicants. In 2010 Fraunhofer research scientists submitted 695 new inventions – more than ever before – of which 505 to the German Patent and Trade Mark Office as patent applications. The number of active patents and patent applications rose to over 5,450.

Successful abroad too

In fiscal 2010 Fraunhofer, together with its international partners, generated revenue (not including license income) totaling 175 million euros – a new record level. This figure includes 21 million euros of income earned by the Fraunhofer subsidiary companies. Revenue from collaborations with European companies and from joint research projects funded at European level rose by close on ten percent to 124 million euros. Orders from European industry (not including Germany) earned Fraunhofer 59 million euros, an increase of 21 percent. Project income under EU programs was at the same level as the previous year, amounting to 65 million euros.

In the USA Fraunhofer carried out projects worth 30 million euros, including work amounting to 20 million euros by the subsidiary company Fraunhofer USA, Inc. Orders from Asia showed a particularly strong increase, and income from that region rose by 33 percent to 17 million euros. There is a particularly strong demand for technological innovation in the energy and environment sectors, and so Fraunhofer expanded its activities in energy-efficient construction and renewable energy in particular. In China the focus is mainly on the development of sustainable water infrastructure systems.

“The country has overcome the financial and economic crisis amazingly quickly and Fraunhofer has been able to contribute. This positive trend did not happen by chance but was the result of taking the correct action and investing wisely,” concludes Hans-Jörg Bullinger.