Sweden is a partner and pioneer in industrial digitisation

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Mechanical engineering industry benefits from Swedish customers' high standards - Partner country of Hannover Messe focuses on automation and Artificial Intelligence - Export growth of 3.3 percent, large number of branch offices

The partner country of this year's Hannover Messe, Sweden, is an important trading partner for mechanical engineering companies in Germany and a pioneer in the digital transformation of the economy, as well. Sweden is a technologically leading high-wage country with a strong affinity for Industrie 4.0-applications and automation solutions. In addition, there is an above-average research quota (3.3 percent of the gross domestic product), which secures the country the top position in the EU (Germany: 3 percent, rank 3). "Due to the high production costs there, high-quality products and solutions that mechanical engineering companies from Germany in particular can offer, are in demand. Automation has top priority in Sweden in order to remain internationally competitive," explains Ulrich Ackermann, Head of VDMA Foreign Trade. "Sweden is also an important partner in the global fight for free trade and against protectionism," he says.

Exports grow significantly
In the ranking of the most important sales markets for German mechanical engineering industry, Sweden ranked 14th in 2018 (January to November inclusive) with an export volume of 3.2 billion euros. This was an increase of 3.5 percent on the previous year. In the same period, Germany imported machines from there worth 1.8 billion euros (plus 1.1 percent). This put the northern European country in 13th place on the import ranking list.
A decline in Swedish investment growth is expected for this year, which could also have an impact on the export balance. However, an increase in investments by local industry is expected in the following years. Germany has been by far the largest machine supplier to the northern European country for years: 26.9 percent of all machine imports came from Germany in 2017. Italy followed far behind (7.7 percent). Swedish industry, with a total of 1.2 million companies, is characterised by strong large groups and a high number of smaller companies. There are only a few genuine medium-sized companies, compared to Germany.  "There is great development and sales potential here. According to their own statements, around 30 percent of small Swedish companies criticize the fact that they still lack the necessary expertise for the challenges of digitization," explains Yvonne Heidler, Sweden expert at VDMA Foreign Trade.

 

"Automation has top priority in Sweden in order to remain internationally competitive".

Artificial Intelligence and Robots
On the other hand, Swedish producers and customers are often trendsetters in the use of new technologies, such as Artificial Intelligence and Machine Learning. In the opinion of experts, the northern European country is even at the forefront of Europe in this respect. When it comes to the use of robots in industry, Sweden is only surpassed by Germany in Europe. In 2017, there were 322 industrial robots per 10,000 industrial workplaces in the Federal Republic of Germany, compared to 240 in Sweden. Production speed, productivity and flexible automation therefore play a decisive role in achieving success in Sweden.

Important location for mechanical engineers from Germany
Sweden is not only an important sales market for mechanical engineering companies from Germany. The VDMA members are represented in the country by a total of almost 240 branches, including assembly and production plants as well as research locations and sales and service branches. The most important customer industries for German machine builders include Swedish mechanical engineering, the automotive industry, forestry, energy producers and the construction sector. "Swedish customers expect individual solutions and a fast response time. That's why it's important as a machine manufacturer to be on-site and close to the customer," explains VDMA expert Heidler. The search for suitable skilled workers is also becoming increasingly difficult in Sweden, which is why German companies are increasingly training their employees themselves.