There is no way around the electrical and digital industry. The new transformation paths study by IW Consult and BDI – Federation of German Industries clearly shows that the electrical and digital industry is the sector with the greatest growth potential in the next five to ten years. No other industry is expected to generate more added value by 2035 – in all scenarios examined.
According to the study, the industry is benefiting from global developments in the major growth markets, all of which revolve around electrification and digitalization: “From AI-supported process automation and electrified heat supply in buildings to the drive system transition in mobility, our companies are active in these growth areas with their solutions – this makes the electrical and digital industry a key sector for the future,” explains ZVEI President Dr. Gunther Kegel. He demands: “In order to exploit this potential to the fullest, we need one thing above all else in addition to entrepreneurial decisions: an industrial-friendly political framework that promotes rather than hinders.”
By strengthening the competitive position of German companies and with positive location development, the value added by the electrical and digital industry from growth markets could double to €182 billion in 2035 compared to today. This would put it well ahead of all other industrial sectors. Based on the study results, the ZVEI is presenting its “Agenda for Tomorrow's Industry.” “The federal government must act more decisively than it has done so far. We need vigorous reforms; the innovation booster that has been decided upon is clearly not enough,” explains Dr. Kegel. At best, the economy is treading water. “In order to secure Germany's position as an industrial location in the long term, politicians must pay greater attention to technology-driven growth markets such as AI, microelectronics, and energy technology.”
Cross-sectional technologies and innovations for growth markets
As a provider of cross-sectional technologies, the electrical and digital industry is involved in almost all of the growth markets identified for the study. In the areas of industrial automation and robotics alone, as well as in alternative drive systems, German value added is estimated to total over half a trillion euros by 2035, assuming positive developments in the competitive environment. The electrical and digital industry accounts for a significant share of this: the development of key components for automation solutions – from components for industrial robots to intelligent control and communication units to embedded software – not only enables more efficient production processes, but also significantly advances the digital transformation in user industries.
An important cornerstone of the electrical and digital industry's high share of growth markets is its focus on innovation: one-fifth of the industry's turnover is attributable to new products. Almost a quarter of all R&D expenditure in the manufacturing sector in Germany comes from the electrical and digital industry.
The electrical and digital industry is already the third-largest domestic industrial sector after the automotive industry and mechanical engineering: “With around 900,000 employees in Germany and sales of €220 billion last year, our industry currently generates around one-seventh of Germany's total industrial value added,” said Kegel. Not to be forgotten are the spillover effects in supplier industries, which also benefited from developments in growth markets.
