Innovations based on effective and efficient research and development are an important growth engine for BASF. We work in interdisciplinary teams on innovative processes and products for a sustainable future. This is how we ensure our long-term business success with chemistry-based solutions for almost all sectors of industry.
A growing need for energy, food and clean water, limited resources and a booming world population – reconciling all these factors is the greatest challenge of our time. Innovations based on chemistry play a key role here, as they contribute decisively to new solutions.
We set ourselves ambitious goals: In 2015, we wanted to achieve sales of around €10 billion with new and improved products or applications that had been on the market since 2011. Despite the challenging market environment, we have achieved this sales goal. EBITDA from innovative products and processes on the market since 2011 was below the targeted amount of €2.5 billion in 2015, according to current estimates. Yet we nevertheless reached our associated goal, which was to achieve margins with innovations that exceeded those of the rest of the product portfolio. In the long term, we aim to continue significantly increasing sales and earnings with new and improved products.
Our innovative strength is based on our global team of highly qualified employees with various disciplines. We had around 10,000 employees involved in research and development in 2015. At the beginning of 2015, we arranged the central research units Process Research & Chemical Engineering, Advanced Materials & Systems Research, and Bioscience Research into three global platforms headquartered in the regions significant for us: Europe, Asia Pacific and North America. As knowledge and competence centers, they form the core of our global Know-How Verbund, joined by the development units in our operating divisions. BASF New Business and BASF Venture Capital supplement this network. Their task is to develop attractive new markets and new business models for BASF based on new technologies.
Our global network with more than 600 excellent universities, research institutes and companies is an important part of our Know-How Verbund. We collaborate with them in many different disciplines in order to achieve our growth targets. In our excellence program UNIQUE, we are working particularly intensively with fifteen leading universities around the world. This program will strengthen and expand our portfolio with creative new projects by giving us even more direct access to scientific expertise, new technologies and talented minds from various disciplines. Also involved in UNIQUE is Heidelberg University, with whom we signed a collaboration agreement for our joint “Catalysis Research Laboratory” (CaRLa) in the spring of 2015. The research cooperation, which began in 2006, addresses current issues in homogeneous catalysis and was extended to October 2017.
Together with researchers from Harvard University – also a member of UNIQUE, as well as of our North American Center for Research on Advanced Materials (NORA) – BASF researchers developed a new method for making amorphous nanoparticles with increased solubility. This property improves the efficient uptake of, for example, vitamins and drugs in the human body. The new process is well suited to a number of different pharmaceutical, food and crop protection applications.
Our research pipeline comprised approximately 3,000 projects in 2015. We increased our spending on research and development by €69 million to €1,953 million (2014: €1,884 million); the operating divisions were responsible for 79% of total
research and development expenditures. The remaining 21% was allocated to cross-divisional corporate research focusing on long-term topics of strategic importance to the BASF Group. Innovations based on chemistry require marketoriented research and development that is sharply focused on the needs of our customers. In order to bring promising ideas even faster to market, we regularly assess our research projects using a multistep process and focus our topics
Another vital factor for our success is a global research and development presence. We continued to broaden our activities in 2015, especially in Asia. In May, we opened a new agricultural research station in Pune, India. The new facility focuses on global research in the areas of herbicides, fungicides and insecticides, as well as on solutions going beyond classic crop protection. In addition, we are also addressing topics there that are especially relevant for India. The extension of our Innovation Campus Asia Pacific in Shanghai, China, was inaugurated in November, strengthening regional research capacity for new materials and systems, as well as our power of innovation for both the region and the world.
We aim to keep strengthening our research and development activities in Asia as well as in North and South America. Our plan is to conduct half of our research and development activities outside of Europe in the long term. We are adapting this to the growth in regional markets. This increased presence outside Europe creates new opportunities for fortifying and expanding customer relations and scientific collaborations, shoring up our Research and Development Verbund and making BASF an even more attractive partner and employer in the regions. Ludwigshafen remains the largest site in our Research Verbund. This was emphasized by the investment we made in a new research building opened in July. It creates modern workspaces and ideal cooperation conditions for around 200 employees in the platform Advanced Materials & Systems Research.
The number and quality of our patents attest to our power of innovation and long-term competitiveness. We filed around 1,000 new patents worldwide in 2015. For the seventh time in succession, we headed the rankings in the Patent Asset Index in 2015 – a method which compares patent portfolios industry-wide. This once again underscores BASF’s power of innovation.
In order to develop future business areas for BASF, we have defined growth and technology fields for which we expect high sales potential in 2020. The focus of our research is derived from three major areas in which chemistry-based innovations will play a key role in the future: resources, environment and climate; food and nutrition; and quality of life. We regularly review the attractiveness of these growth and technology fields for BASF and adjust our portfolio as necessary.
Innovative mobility concepts such as electromobility require batteries that are high-performance, affordable and safe. Therefore, in the Batteries for Mobility growth field, we are researching important system components of a battery, such as new cathode materials with a higher energy density and improved cost-benefit profile, and electrolytes for increased lifespan in lithium-ion batteries. In 2014, we expanded our research and development facilities in Beachwood, Ohio, and Amagasaki, Japan, where we will explore new cathode materials and improved electrolyte systems in the future. In order to better understand battery materials and stimulate new ideas, we work together with renowned scientists worldwide in our “Research Network Electrochemistry and Batteries.” We decided in 2014 to continue the university network, which was established in 2010, for another five years.
The growing world population’s increasing demand for food requires additional solutions for healthier plants and higher yields that supplement conventional crop protection. This is why we research new products in the Functional Crop Care growth field that, for example, improve plant growth, better protect seeds, and help plants use scarce resources like water and nutrients more efficiently. Farmers all over the world mainly employ urea-based fertilizers in order to ensure that plants are supplied with enough nitrogen. However, some of the nitrogen contained in these fertilizers is lost as gaseous ammonia. Limus® can greatly reduce these losses. Thanks to its special formulation, this product also enables better storage of urea-based fertilizers. Limus® guarantees farmers both efficient fertilizer application and higher yields.
One of our projects in the Automotive Lightweight Composites growth field is the search for innovative materials and material systems that can be used to manufacture load-bearing components, such as the frame or passenger compartment, out of fiber-reinforced plastic. We are developing composite systems based on epoxy, polyurethane and polyamide resins. Carbon fibers lend themselves particularly well to reinforcement materials thanks to their high rigidity. In addition to developing the materials themselves, we are also adapting composite systems to the automotive industry’s new manufacturing processes in order to make their transfer into large-scale production economically viable.
Various cross-sectional technologies provide the basis for developing our growth fields. We have grouped these into three technology fields: Materials, Systems & Nanotechnology, Raw Material Change and White Biotechnology.
The challenges of the future require intelligent solutions based on new systems and functional materials, which means that formulation and application expertise is increasing in significance. In the Materials, Systems & Nanotechnology technology field, BASF researchers work for example on new color filters that can be used in laptop and computer monitors as well as television screens. Irgaphor Red® S 3621 CF, BASF’s new red pigment, ensures especially high image quality in liquid crystal displays. Thanks to its tiny particles that are less than 40 nanometers in size, light is less scattered in the color filter. The viewer therefore sees a very sharp image with clear colors and high contrast.
In the Raw Material Change technology field, we are searching for alternatives and supplements to crude oil as a raw material for the chemical industry. With natural gas, carbon dioxide and renewable resources, we aim to expand the raw material basis of our value chains in the long term. To do so, we use catalysts that make many chemical reactions more cost-effective, more environmentally compatible, or in some cases even possible. In the BasCat joint laboratory at the Technical University (TU) of Berlin, we and our partners seek to gain fundamental knowledge on activating less reactive molecules in order to accelerate the development of industrial catalysts in the long term. We started operations at the new BasCat laboratory building on the TU Berlin campus in 2014.
In the technology field White Biotechnology, we are researching methods and techniques for creating chemical and biochemical products in an efficient and resource-saving manner. Fermentation and biocatalysis increasingly represent competitive alternatives to chemical processes. Our researchers are working on new enzymes for technical applications that use molecular biological methods to improve the applications’ properties. Furthermore, they optimize fermentational production processes in order to produce enzymes on a large scale at high yield.