IVAM Survey 2020: Climate change discussion spurs innovation in microtechnology

Climate change, which has been the subject of intense debate over the past year, is also leading to increased development of sustainable technologies in the microtechnology sector. Innovations from developers and suppliers are in demand, especially in the field of automotive drive technology and in power engineering.

In this year's economic data survey, the IVAM Microtechnology Network focused on application trends and drivers for innovations.

Stronger efforts to advance electric and hydrogen drives

A little more than half of the microtechnology companies and research institutions serving the automotive industry say that climate change is a major driver of innovation. The influence of the climate discussion is particularly noticeable in automotive drive technology:

A little more than two-thirds (68.4%) of the microtechnology companies and institutes involved in automotive drive engineering at present are working on combustion engines, but the proportion is expected to decline in the medium term to 62.5%.

However, a higher proportion (78.9%) are currently working on electric drives; this proportion is expected to rise to over 90% within the next three years.

Almost half (47.4%) of the companies and institutes involved in drive technology are working on hydrogen drives, and the proportion is expected to rise to over half (56.3%) within the next three years.

Energy storage is an issue of growing importance

The microtechnology industry also considers climate change to be a major driver for innovation in power engineering: a large part of the companies and institutes targeting the power engineering industry confirms this.

In addition, more than half of the companies and institutes active in power engineering consider the scarcity of fossil fuels to be an important driver of innovation in this field.

Energy storage is an issue of growing importance for the industry: 63.6% of organizations working on power engineering supply products and technologies for this area; this proportion will rise within the next three years.

The share of companies and institutes working on alternative drives will also rise from 45.5% today to 63.3% in three years’ time.

Overall, a rather small proportion (9.3 %) of the responding companies and institutes are active in power engineering to date.

Digitalization inspires various applications

Digitalization inspires innovations in the most diverse application fields of microtechnology, above all in mechanical engineering and process automation, but also in medical technology and automotive engineering.

Of the application fields that were more closely investigated in the survey, digitalization has the greatest influence on innovation in automation / mechanical engineering (66.7%), followed by medical technology (44.8%) and automotive engineering (41%) – only 9.1% consider digitalization to be an important driver of innovation in power engineering.

Microtechnology industry is competing for skilled workers

Competition for specialists is becoming apparent in the microtechnology industry: around 60% of organizations – research institutes as well as companies – see finding and retaining qualified employees as a challenge. 

Companies struggle for economic stability

The microtechnology industry – especially companies – was partly worried about its economic wellbeing already at the time of survey, which ended in early March 2020 before the escalation of the coronavirus pandemic.

About a third of companies each named profitability, innovative strength and competitiveness as factors of uncertainty. The proportion of enterprises that are concerned about being able to operate profitably or grow was remarkably high at 45.3%.

Profitability must be a constantly pressing issue for those suppliers, who are highly specialized and supply customized solutions in small batches regardless of the corona crisis. Meanwhile, concerns about economic stability are very likely to have increased due to the coronavirus pandemic and the resulting shutdown of parts of the economy.

Coronavirus crisis makes mid-term economic development unpredictable

Economic state and development of the microtechnology industry was good last year, but the corona crisis is likely to have halted the positive trend and, above all, made forecasts for medium-term development invalid.

IVAM conducted the survey in February and early March 2020 before parts of the economy were shut down and the full impact of the coronavirus pandemic became apparent. 

In a short survey of representatives of the microtechnology industry conducted later in March, the industry was still confident and did not fear any serious long-term economic consequences. The result of this short survey can be read here: https://www.ivam.de/corona_krise