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Luxembourg’s automotive components sector boasts an annual turnover of €1.5 billion and employs over 10,000 people, with around 50 companies active in this field.

“Over the last decades, the Grand Duchy has become a key location for first and second tier suppliers to the automotive industry,” stated Mr Schneider, adding that “all European development headquarters can be reached from Luxembourg within one working day”.

In addition to this geographical advantage, Luxembourg also relies on multilingual and multicultural advantages. “International clients are able to receive the service they need conveniently, in their own language, and with an understanding of their business culture. This makes the Grand Duchy an ideal location for component suppliers with a multi-customer base to develop and tailor products to a wide range of customer requirements.”

Perhaps more than in other industries, innovation is an essential driver for the development of the automotive industry. Luxembourg is well positioned in important R&D areas such as electronics and sensors, Advanced Driver Assistance Systems, navigation and on-board diagnostic systems. Currently, around 25% of the automotive workforce in Luxembourg are employed in R&D. “But Luxembourg will go a step further with the building of the Luxembourg Automotive Campus which will provide state-of-the-art facilities to companies – corporations and start-ups alike – dedicated to innovation in automobility.” The open campus will be able to accommodate up to 4,000 people in the future.

Luxembourg a digital pioneer

Minister Schneider also recalled the recent signature of a joint agreement with the German and French governments to establish and cooperate on an experimental cross-border testbed for automated and connected driving. “This initiative is once again putting Luxembourg at the intersection of mobility and digitisation,” he said. “We want Luxembourg to take its place as a ‘digital pioneer’ in Europe and to be a leading world class hub for High Performance Computing and Big Data. The Luxembourg government is committed to industrial activities and aims to develop and maintain a value added and R&D intensive industry in the country.”

The automotive sector will for sure change a lot in the upcoming years. “Mobility is at a historical turning point,” commented Minister Schneider. If the big story of the early 20th century was the ascent of the automobile over other forms of individual transport that led to the mass production of vehicles, the new models show today plenty of disruptions related to of autonomous driving, connected services, new mobility offerings and an increase in the electrification of vehicles.

“Many local actors in Luxembourg have the competences to digitalise mobility and thus to face these challenges successfully in many fields,” Minister Schneider said. “The proven cooperation in Luxembourg between academia, industry and the public sector using Luxembourg as a living lab for real-life, large-scale testing will contribute to the prosperous development of the local automotive sector.”

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