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Coming back for seconds: Why big brands expand their (R&D) presence in Austria

What counts in the field of sales is the realization that cultivating and further developing an existing market is less resource-intensive than building up a presence in a new market in a still unknown region. This also applies to the field of research and development. However, convenience cannot be the argument that is used here. The fact that Vienna is rated as the most liveable city in the world according to annual rankings falls under the category of soft facts, but is hardly important within the context of the intense internal competition in a multinational company.

So, what are the hard facts? At the very top of the list are the country's geographical location in the heart of Europe and Austria's role as a business interface for economic ties between East and West. In this regard, the country is considered an optimal starting point for all types of business and for logistics. The road junction is just as important as the convergence of high voltage power lines, gas pipelines and fibre optic lines for other industries. For many companies, an important success factor for initiating business relations in the new growth markets is also the "mental proximity" of Austria to its Eastern European neighbours.

In the heart of Europe

For example, Interxion has been active in Vienna as a computer centre operator for more than two decades and has invested more than EUR 100 million over the last five years alone in its data processing campus. Another EUR 40 million in investments is in planning. Thanks to its proximity to Central and Eastern European markets, Austria offers a major bonus to Interxion, in light of the fact that Vienna is an important information hub from which to serve both South East and Eastern Europe as well as the domestic market itself. Business location decisions are also decisions of confidence in the overall conditions, and in the country's security and stability, also in connection with the electricity supply, a particularly critical factor for computer centres. Moreover, Austria offers an extremely high share of renewable energy, above all hydropower, which is becoming increasingly important as an image factor in times of sustainability, especially for international brands.

Labour productivity, motivation and loyalty

Another benefit for Interxion is the high level of labour productivity. Austria is not a low-wage country. Here quality, motivation, productivity and the good education of employees play a key role. The high quality of life also attracts qualified employees from abroad. Companies also have good experience with respect to their cooperation with universities and universities of applied sciences. Furthermore, whoever has tried out the funding possibilities Austria offers in research and development sticks to his opinion that experience is the basis for certainty.

The most research-intensive pharmaceutical companies in Austria includes Boehringer Ingelheim, with annual research expenditures of EUR 200 million. Since 1985 the company has already been represented in Vienna by the Research Institute of Molecular Pathology (IMP) in Vienna. In addition, the company's entire clinical research in the region is coordinated from Vienna. The Austrian capital is the centre for cancer research and a site for biopharmaceutical research, development and production in the Group. This is because Austria stands out as a result of its long-term reliable and stable business environment. These are qualities which are important to a pharmaceutical company conducting research such as Boehringer Ingelheim, as is the good research infrastructure.

In addition to research, Boehringer Ingelheim is also expanding its production and is currently constructing a new biopharmaceutical production plant in Vienna. The new facility is the largest single investment in the company's history, featuring investments of close to EUR 700 million. The fact that this production plant is not being built at Boehringer Ingelheim's headquarters in Germany but in Vienna was not an obvious step. However, Vienna is trying hard, especially when it comes to nitty-gritty details such as a separate "Boehringer" exit for company employees when getting off the express train.

Vienna is different, Vienna is better a sentence found on Boehringer Ingelheim's Website. The research team in Vienna has discovered several substances from which new cancer drugs could be made. They will be tested on lung cancer patients in the coming years.

As part of the German pharmaceutical company, the Boehringer Ingelheim Regional Centre Vienna is responsible for more than 30 countries in Central and Eastern Europe as well as in Central Asia. Vienna remains one of the most important business locations for the German pharmaceutical giant Boehringer Ingelheim.

Driving force for innovation in companies

Vienna is also a driving force for innovation and one of the growth drivers within the company Ottobock. The German company has been represented in Austria since 1969. More than 600 employees work in the Austrian capital. One third of the workforce is involved in research and development. The cooperation with leading scientists at universities as well as partners from relevant areas of application and specialist retailers comprises a key platform for research work. For this reason, Ottobock is expanding its high-tech facility in Vienna.

However, Austria is also a business location for tradition, not only in the field of life sciences, but also for the mobility industry in Austria. In particular, leading manufacturers such as BMW, Magna, M.A.N and others take advantage of related companies in the supply industry and above all the existing know-how in the country. They are continuing the tradition of the automobile sector here. Furthermore, Austria can boast a good working climate. Strikes are measured in seconds, which is of the utmost importance for delivery reliability.

Jakob Cencic, MA

Director Africa, Middle East
+43-1-588 58-238 or +43-676-6517077

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