Foreign investors drive Czech R&D

The Czech Republic is a highly-industrialized country and one of the factors behind a successful industrial sector is research and development. Last year, R&D expenditure increased, by almost 5%, but on the other hand, its share in gross domestic product decreased slighttly to just under 2% of GDP, the long-term target of Czech governments. 

Foreign-owned companies play an ever increasing role in R&D in the Czech Republic. They account for 60% of R&D expenditures of all companies in the Czech Republic, which, given that the business sector is responsible for 65% of total R&D expenditures in the Czech Republic, makes them the largest financial supporter of Czech research responsible for 41% of total Czech expenditure on R&D.  

More than 600 foreign-owned companies spend money on research and development in the Czech Republic. Of course, there are more domestic companies, but 99 foreign-owned companies spent more than 100 million CZK on research and development in 2023, while only 32 of the purely Czech domestic companies spent more than 100 million on R&D. 

Among the companies that spend the most on R&D in the Czech Republic are not only Škoda Auto, our largest industrial company, but also companies such as Continental, Valeo, Honeywell, ThermoFischer Scientific, GE Aviation, Bosch, and Siemens. For example, more than a thousand Honeywell engineers develop new solutions in the Czech Republic not only for air transport, but also for urban mobility, and two years ago opened a new research and development center for advanced automation of warehouses and logistics centers in Brno. Valeo, a manufacturer of automotive components, has more than seven hundred employees in research and development in Prague. 

Japanese Panasonic is building a development centre for heat pumps in Pilsen. It will become the centre of both production and research and development of Panasonic heat pumps in Europe. Panasonic follows the example of other foreign investors who usually invest in production in the Czech Republic first, but after a few years they also start to develop products here. 

However, there are also foreign companies in the Czech Republic that do not have production in the Czech Republic, but still carry out R&D here. We can name, for example, Porsche Engineering, Akkodis (formerly Mercede-Benz Engineering), or Rockwell Automation. These and other companies mentioned and not mentioned have joint projects with universities and research institutes and often participate in research projects funded from domestic or European sources. For example, Brno-based Honeywell manages joint European research in the field of aviation and is the largest recipient of support from the EU´s Horizon Europe programme among companies in the Czech Republic.  

This year, CzechInvest plans to conduct a detailed survey of our foreign investors' research and development activities, cooperation with Czech universities and research institutes, and the use of research and development results.