ACEA

- SWEDEN

Sweden is among the countries in the world that are most highly dependent on the motor vehicle industry. Despite a population of only 9 million, Sweden hosts two important carmakers in Volvo Cars and Saab Automobile and two of the world’s leading heavy truck and bus manufacturers – Volvo Group and Scania. In 2006, these two firms accounted for one fifth of the heavy trucks over 16 tons produced in the world.

Consequently, the motor vehicle industry is vital to employment, exports, investments, research and development, and the dissemination of knowledge in the country. It employs approx. 140 000 persons and accounts for exports valued at SEK157bn (EUR 17bn) in 2006, which represents 14,5 percent of Sweden’s total exports of goods and makes it the largest Swedish export industry. Moreover, one fifth of the machinery and inventories investments and a quarter of the R&D investments of the whole of Swedish manufacturing industry come from the automotive sector.

Spin-offs from the technology-intensive motor vehicle industry also benefit other industries in terms of employment, advanced technical development and transfer of knowledge. This is of major importance to the IT sector, for instance. Moreover, the motor vehicle industry produces indirect employment in other industries, such as the commerce and services sectors. It is estimated that one tenth of all people employed in Sweden are working in road transport related areas. If anything, dependence on the automotive industry as a source of jobs has increased in recent decades as other industries have cut back their operation, closed or relocated. The Volvo Group remains the largest private employer of the country.

The industry is highly export-oriented. Of the total car production by Volvo Cars and Saab Automobile, 85% is sold outside Sweden and more than 95% of the heavy vehicles produced by the Volvo Group and Scania are sold on export markets. But the domestic market remains the second most important market for Volvo and the third for Saab.

SMEs are important suppliers

Swedish vehicle makers control the entire manufacturing chain from development to assembly. Their businesses rely on a strong supplier industry comprising more than 1,200 individual companies, a work force of 75,000 people and annual revenues of more than SEK100bn (EUR 10.9bn). About 50% of the companies are small businesses with annual revenues of less than SEK20m (EUR 2.18m). Autoliv, SKF, Haldex and SSAB are some of the large, well-known global suppliers with their headquarters in Sweden. In addition, many global first rank companies have subsidiaries in Sweden, among them Delphi, Visteon, Johnson Controls, Tenneco, Valeo, Bosch and Benteler. Engineering and design companies like Semcon, Caran, Sigma, Teleca and Gesab play an important role as service providers. Additionally, with an increasing number of electronic components and systems being integrated into vehicles, software and electronic component producers are now also an important part of the industry. Sweden has a strong position in telematics and active safety systems..

Much R&D is collaborative

Government R&D funding is currently being allocated to some 20 research and development programmes aimed at or closely relevant to the automotive industry. The business sector has invested approximately SEK2.1bn (EUR 0,22bn) in these programmes. Government funding has amounted to some SEK1.7bn (EUR 0,18bn), an average of SEK450m (EUR 49,1m) per year. Moreover, almost 50 percent of companies with more than 50 employees have cooperation arrangements with universities or research institutions. Most of these initiatives are being implemented under the Program for Automotive Technology Research, a national body created to coordinate and sponsor industry and university research efforts. Furthermore, in the so-called Green Vehicle programme, the Swedish motor vehicle industry is working together with the state in a collaboration programme to conduct research and development for environmentally sustainable automotive engineering.