Research & Development
Research and development ratio at 5%
Among other things, ElringKlinger’s corporate philosophy involves being close to the customer, spotting trends early, and helping to actively shape new solutions. To this end, the Group invests a substantial amount in research and development every year - around 5% of its revenue. Deployed in a targeted manner, this capital expenditure underpins the strong competitive position enjoyed by the ElringKlinger Group.
In response to the far-reaching process of transformation in the automotive industry, ElringKlinger is focusing its research and development (R&D) activities primarily on solutions for alternative drive technologies. R&D expenses amounted to EUR 64.1 million in financial year 2019 (2018: EUR 76.1 million). In total, EUR 16.7 million (2018: EUR 11.1 million) in development costs were capitalized, as they met the relevant criteria for recognition. This contrasted with amortization of capitalized development costs totaling EUR 5.7 million (2018: EUR 6.2 million). Taking into account development costs capitalized by the Group, the R&D ratio, i. e., R&D costs relative to Group revenue, fell to 4.7% (2018: 5.1%).
| Key figures R&D | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|
| R&D costs (incl. capitalized development costs) (in EUR million) |
80.8 | 87.2 | 75.9 | 74.8 | 71.2 |
| R&D ratio (incl. capitalized development costs) | 4.7 % | 5.1 % | 4.6 % | 4.8 % | 4.7 % |
| Capitalization ratio1 | 20.7 % | 12.7 % | 5.9 % | 9.9 % | 13.8 % |
1 Capitalized development costs in relation to R&D costs, including capitalized development costs
Number of R&D staff increased in FY 2019
The Group has established a strong culture of innovation. The Group has concentrated its main development activities at the German sites operating within the Original Equipment and Engineered Plastics segments and at its US plant in Southfield, Michigan. Smaller modifications are also performed at other locations. ElringKlinger built up additional know-how during the 2019 financial year, especially in the field of battery and fuel cell technology. As a result, the number of employees working in R&D as of December 31, 2019, stood at 611 (2018: 590).
New patent applications above previous year’s level
ElringKlinger always seeks legal protection for new developments at both product and process level. In 2019, the centralized patents unit, which is tasked with protecting the company's technological expertise and intellectual property rights, applied for 81 (2018: 80) new patents.