R&D Credited as Automotive Sector’s Route to Success


Putting money into R&D really pays off – at least that’s the shared vision of the world’s leaders in the automotive sector. Following the release of some of the biggest car manufacturers’ R&D spend figures, the automotive sector has cemented its position at the forefront of innovation.

The importance of research and development (R&D) is well-documented. Businesses understand it to be a critical stage through which to develop new practices and products. From innovation comes the opportunity to further growth and continued viability. Despite being considered a valuable tool with which secure the future, R&D never fails to prompt discussions about input and output; whether, in financial terms, you ever really get back what you put in.

Determining how much you ought to spend on R&D to get the best results, is quite the task though, if leading automotive manufacturers are anything to go, that figure is in the billions. Last year, international business expert, PwC, reported £78 billion was spent on R&D in the automotive industry and domestic car manufacturers racked up the biggest bills by far. Volkswagen led the pack, investing a huge £10.9bn in R&D. Following last year’s emissions scandal, the manufacturer has renewed its commitment to fuel efficiency and green travel. Those ambitions will culminate in the release of the Mk7 Golf in 2018, a vehicle expected to be the most efficient available on the consumer market.

Second and third place in the R&D stakes – Toyota and Mercedes respectively – barely came close to Volkswagen’s figure though still spent a hefty £6.6bn and £5.5bn each. GM and Ford complete the top five while Honda, BMW and Nissan also spent several billions on R&D apiece. Major tyre and parts manufacturers, including Continental and Aisin Seiki (a subsidiary of Toyota) also put up significant R&D figures, finalising the automotive industry’s hold on the sector.

Although it’s hard to truly discern to value of R&D, reflecting on the automotive sector’s continued success, it appears the pay-off of major investment is not to be overlooked. It’s only as a result of regular and significant emphasis on innovation that customers are able to travel more easily and comfortably, and our shared carbon footprint is drastically reduced.

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