We had a briefing this morning with the UK embassy as well as individuals from the Labour Party, foreign commercial service, agriculture affairs, economic affairs, the counsel general and cultural and public affairs.
There are 26,000 individuals employed by UK companies in Indiana and $8 billion of UK business is conducted in Indiana.
We talked about the current political landscape in the UK. The UK is dominated by two major parties -- the Conservatives and the Labour party. The Prime Minister is the true power in Great Britain and is the leader of the party with the majority in Parliament. All houses of Parliament are up for election in three years which is expected to be a very lively and spirited election.
The single, greatest issue for the British is global warming. The United States is not viewed as a leader in environmental protection, however, and there are some negative feelings toward the United States on this and other global issues.
With regards to public affairs, we talked about three areas of focus to help strengthen the ties between the US and the UK. They include: engaging in student exchange programs, developing cultural exchange programs and developing strong international visitor programs.
We also heard from a representative from the commercial service. With regard to bi-lateral trade, there is about $170 billion being traded between the UK and US. Trade was up 7 percent in 2004 and 2005. US exports increased 25 percent in 2006. We obviously have a very strong and important relationship with the UK with respect to trade.
As you might expect, there are a number of similarities between the UK and the US including a common language, strong IP protection, similar business and legal systems, and a well-educated and flexible workforce. Key areas of synergy include: aerospace, computers, electronics, renewable energy and pharmaceutical.
Finally, during our tour we've learned some fun facts about the UK. For example, you have to register 24-hours before you gamble at any casino in London. There is a per car cost – about $80 per day – to get into the city of London and park, which is one way to incenticize people to take public transportation. There at about 8 million people in London, nearly 5 million are immigrants. Museums are free of charge however you can only tour Buckingham Palace during July and August, when the Queen is on holiday. There are 23 ½ acres of shopping at Harrods Department Story. The UK is also considered a "country of hobbyists."
The dollar is weak relative to the pound – about 2 to 1.
Thursday, May 17, 2007
Wednesday, May 16, 2007
Day Five:
We traveled from Germany to the UK today and arrived in London around 2pm. The news that is dominating the headlines is the fact that on June 27, the UK will have a new Prime Minister, Gordon Brown, who is replacing Tony Blair.
The UK is a little smaller than Oregon. It is a major financial market with the fifth largest economy in the world. The economy had a 3 percent economic growth in 2006. The major industries include steel, heavy engineering, manufacturing and textiles.
We passed through Hyde Park today, which is equivalent to New York's Central Park. It is a tribute to the Duke of Wellington. People still ride horses through Hyde Park including the cavalry. They plant "Plane" trees, a member of the sycamore family, in the park. The trees shed their bark every year as a protection against the pollution from the city of London.
In the evening, we attended a reception with the UK Motorsports Association. We discussed the possibility of building a wind tunnel in Indiana, similar to the Formula One wind tunnel we visited in Cologne. The investment could be as much as $50 million. It is a huge opportunity for Indiana to compete for the R&D dollars expected to be invested in the motorsports industry.
We also visited with executives of Keronite who are looking to expand their operations in the United States, possibly in Indiana. They started in Indiana with 3 employees and they now have 9.
Agriculture is also very important in the UK. The UK, Germany and Holland are the three most important countries in Europe with respect to agriculture. The UK is also looking into alternative energy sources, including bio-fuels and wind energy.
Thirty-four percent of all EU investment goes to the UK. On any given day approximately 500,000 Americans are in the UK. About 125,000 visas are issued a year in 170 nationalities.
The UK is a little smaller than Oregon. It is a major financial market with the fifth largest economy in the world. The economy had a 3 percent economic growth in 2006. The major industries include steel, heavy engineering, manufacturing and textiles.
We passed through Hyde Park today, which is equivalent to New York's Central Park. It is a tribute to the Duke of Wellington. People still ride horses through Hyde Park including the cavalry. They plant "Plane" trees, a member of the sycamore family, in the park. The trees shed their bark every year as a protection against the pollution from the city of London.
In the evening, we attended a reception with the UK Motorsports Association. We discussed the possibility of building a wind tunnel in Indiana, similar to the Formula One wind tunnel we visited in Cologne. The investment could be as much as $50 million. It is a huge opportunity for Indiana to compete for the R&D dollars expected to be invested in the motorsports industry.
We also visited with executives of Keronite who are looking to expand their operations in the United States, possibly in Indiana. They started in Indiana with 3 employees and they now have 9.
Agriculture is also very important in the UK. The UK, Germany and Holland are the three most important countries in Europe with respect to agriculture. The UK is also looking into alternative energy sources, including bio-fuels and wind energy.
Thirty-four percent of all EU investment goes to the UK. On any given day approximately 500,000 Americans are in the UK. About 125,000 visas are issued a year in 170 nationalities.
Day Four (afternoon):
We traveled to Dusseldorf in the afternoon for a bioenergy roundtable. It was an impressive panel featuring the German State Secretary for Federal, European and Foreign Affairs of the state of North Rheine, Matthew Boyse, the US Consulate General, several key German cabinet members and representatives from key biodiesel companies, including Cargill. Gov. Daniels, representatives from the Indiana Department of Agriculture and several delegates also participated. We discussed issues relating to bio-diesel development in Germany. Our delegates talked about BioTown USA, located in Reynolds, Indiana in White County.
Germany has a very similar initiative to BioTown called Unda. It has been in existence for about a year. The idea is to create a fully sustainable town that derives its energy needs from renewable resources such as animal waste, crops etc.
We learned that Germany has the same kinds of issues with respect to renewable resources -- the use of food vs. fuel, for example. One significant difference between the US and Germany is that the European Union dictates set levels of production of bio energy fuels. It is mandatory in Germany vs. the United States, which is voluntary. This creates quicker compliance but very little legislative power for countries to define what they can do with respect to energy production.
We also talked about biomass, feed and fuel vs. energy. We discussed the conflicts between these two groups and the challenges associated with balancing these frequently competing interests.
Dusseldorf is in the process of creating a combined heat and power plant. Traditional power plants create about a 40 percent efficiency. A combined heat and power plant, however, creates a 90 percent efficiency rate. Both countries agreed price and costs are key motivators to incent behavior and increase profitability so companies will want to invest in biofuel initiatives.
Finally we talked about the areas of synergy between our two countries including life sciences, advanced manufacturing and agriculture.
In the evening we attended a "Friends of Indiana" reception. There were approximately 150 dignitaries in attendance including top officials from the Dusseldorf area and clients and friends of the various delegates and Indiana companies. There was a discussion about how important Indiana is and how important it is for Germany and Indiana to develop closer ties. Dusseldorf has a sister-state relationship with Pennsylvania but the officials are very interested in expanding their relationships in the United States and, in particular, in Indiana.
Dusseldorf is the economic center of Western Germany. It dates back to 1135 and is located on the river Rhine. It hosts a thriving advertising and fashion industry and several high-end clothing stores. Many Internet companies also have their roots in Dusseldorf. Seventeen percent of the Dusseldorf population are immigrants and it has the third largest Jewish population in Germany. It is home to the third largest commercial airport.
People generalize in the practice of law, which is somewhat different from the United States. The law firms also tend to be much smaller.
There are approximately 640 US companies with offices in Germany. About 170,000 US citizens work in Germany, a majority for Ford Motor Company.
Germany has a very similar initiative to BioTown called Unda. It has been in existence for about a year. The idea is to create a fully sustainable town that derives its energy needs from renewable resources such as animal waste, crops etc.
We learned that Germany has the same kinds of issues with respect to renewable resources -- the use of food vs. fuel, for example. One significant difference between the US and Germany is that the European Union dictates set levels of production of bio energy fuels. It is mandatory in Germany vs. the United States, which is voluntary. This creates quicker compliance but very little legislative power for countries to define what they can do with respect to energy production.
We also talked about biomass, feed and fuel vs. energy. We discussed the conflicts between these two groups and the challenges associated with balancing these frequently competing interests.
Dusseldorf is in the process of creating a combined heat and power plant. Traditional power plants create about a 40 percent efficiency. A combined heat and power plant, however, creates a 90 percent efficiency rate. Both countries agreed price and costs are key motivators to incent behavior and increase profitability so companies will want to invest in biofuel initiatives.
Finally we talked about the areas of synergy between our two countries including life sciences, advanced manufacturing and agriculture.
In the evening we attended a "Friends of Indiana" reception. There were approximately 150 dignitaries in attendance including top officials from the Dusseldorf area and clients and friends of the various delegates and Indiana companies. There was a discussion about how important Indiana is and how important it is for Germany and Indiana to develop closer ties. Dusseldorf has a sister-state relationship with Pennsylvania but the officials are very interested in expanding their relationships in the United States and, in particular, in Indiana.
Dusseldorf is the economic center of Western Germany. It dates back to 1135 and is located on the river Rhine. It hosts a thriving advertising and fashion industry and several high-end clothing stores. Many Internet companies also have their roots in Dusseldorf. Seventeen percent of the Dusseldorf population are immigrants and it has the third largest Jewish population in Germany. It is home to the third largest commercial airport.
People generalize in the practice of law, which is somewhat different from the United States. The law firms also tend to be much smaller.
There are approximately 640 US companies with offices in Germany. About 170,000 US citizens work in Germany, a majority for Ford Motor Company.
Tuesday, May 15, 2007
Day Four:
Today we toured the Toyota F1 plant. It was a fascinating visit. We were greeted by a long line of plant officials, very reminiscent of our trip to Japan where formal greetings and customs are very common.
All the parts for the Toyota Formula One cars are manufactured in the plant – all under one roof. We were able to visit a test room that simulates actual racing conditions – rain, humidity, air, wind, etc. It tests all the dynamics of the car including speed, corrosion and efficiency.
We also visited a closed-loop wind tunnel. The environment is designed to test wind drag and resistance in a effort to increase the aero-dynamics of the car. The average driver is about 5'6"-5'8" and approximately 8,500 parts are required to manufacture a car.
Formula One is the largest sporting event worldwide, outside of the Olympics. There about 17-19 races per year. It offers substantial marketing opportunities for companies. In Europe, about 42 percent of Europeans prefer motorsports, with Formula One being the most popular. In the United States, 28 percent of Americans prefer motorsports.
We also spent the day touring Cologne, the sister-city of Indianapolis. The Indianapolis Fire Department and the Indianapolis Zoo have partnerships with their respective counterparts in Cologne.
Cologne is the fourth largest city in Germany with a population of over 1.8 million. Cologne is home to the Kolner Dom, a prominent Gothic Church that took 500 years to build. It sustained major damage during World War II. They are known for their beer called Kourlesch It is also the dialect they speak so they say, "It's the only language you can drink!"
All the parts for the Toyota Formula One cars are manufactured in the plant – all under one roof. We were able to visit a test room that simulates actual racing conditions – rain, humidity, air, wind, etc. It tests all the dynamics of the car including speed, corrosion and efficiency.
We also visited a closed-loop wind tunnel. The environment is designed to test wind drag and resistance in a effort to increase the aero-dynamics of the car. The average driver is about 5'6"-5'8" and approximately 8,500 parts are required to manufacture a car.
Formula One is the largest sporting event worldwide, outside of the Olympics. There about 17-19 races per year. It offers substantial marketing opportunities for companies. In Europe, about 42 percent of Europeans prefer motorsports, with Formula One being the most popular. In the United States, 28 percent of Americans prefer motorsports.
We also spent the day touring Cologne, the sister-city of Indianapolis. The Indianapolis Fire Department and the Indianapolis Zoo have partnerships with their respective counterparts in Cologne.
Cologne is the fourth largest city in Germany with a population of over 1.8 million. Cologne is home to the Kolner Dom, a prominent Gothic Church that took 500 years to build. It sustained major damage during World War II. They are known for their beer called Kourlesch It is also the dialect they speak so they say, "It's the only language you can drink!"
Day Three:
We took a bullet train to the DaimlerChrysler plant in Stuttgart, Germany today. It was incredible timing given the news of the sale of Chrysler to Cerberus Capital Management.
Forty-percent of the engines manufactured in Stuttgart are sent to North America. The plant manufactures international engine parts for a variety of automobiles. They can create hundreds of variations of different engines.
The plant employs 18,000 workers. From a labor perspective, there are numerous differences between the United States and Germany. The plant has two shifts, for example, and the night shift is completely voluntary with workers receiving a 20 percent pay increase for working the late shift. This is a huge difference from the United States. German manufacturers often send employees to trade school and pay for their education. About 85 percent of their employees come from these trade schools. Like most large manufacturers, DaimlerChrysler has its own trade school.
The German workforce is also quite "old." The average worker is 42. This is a very serious problem because they are struggling to attract young workers. This is due, in part, to the low birthrate. They have a special place designated in the factory for older workers to help them continue in the workforce. They are very proud to have had no layoffs since the 1940s, partially because of the voluntary approach to work.
There are also some differences with respect to union representation. The unions in Germany represent the entire workforce. They are very cooperative and work in parallel with the company's interests. Approximately 25 percent of the white collar workers are represented by a union and about 75 percent of the blue collar workforce is represented by the union.
A continuing theme we have witnessed is that there are very few women are in the workforce. The employees are asked to handle a number of jobs on rotation, including some manual, heavy labor. We only saw three women working in the plant during our tour.
DaimlerChrysler looks at "right-to-work states" when considering where to re-relocate in the United States. They feel that it is a very important component to consider when looking at expansion opportunities.
Most surprising is the fact that they don't use water at all in the plant. They use mineral oil instead to lubricate the engines. It's the same compound they have used since 1995. It requires a very elaborate vapor suppression system to prevent fires.
Many of the DaimlerChrysler representatives we met with today were unable to comment on the news and the pending deal. It was somewhat apparent, however, that the cultures of the two companies, Daimler and Chrysler, never fully blended.
We ended the day with an authentic dinner at a lovely restaurant called Wirtshaus in Frankfort. We had a traditional dinner of sauerkraut, sausage, pretzels, flatbread, asparagus and goulash. The delegates spent the dinner discussing the Chrysler news and the economic opportunities for our state. We were all incredibly impressed with the DaimlerChrysler plant.
Forty-percent of the engines manufactured in Stuttgart are sent to North America. The plant manufactures international engine parts for a variety of automobiles. They can create hundreds of variations of different engines.
The plant employs 18,000 workers. From a labor perspective, there are numerous differences between the United States and Germany. The plant has two shifts, for example, and the night shift is completely voluntary with workers receiving a 20 percent pay increase for working the late shift. This is a huge difference from the United States. German manufacturers often send employees to trade school and pay for their education. About 85 percent of their employees come from these trade schools. Like most large manufacturers, DaimlerChrysler has its own trade school.
The German workforce is also quite "old." The average worker is 42. This is a very serious problem because they are struggling to attract young workers. This is due, in part, to the low birthrate. They have a special place designated in the factory for older workers to help them continue in the workforce. They are very proud to have had no layoffs since the 1940s, partially because of the voluntary approach to work.
There are also some differences with respect to union representation. The unions in Germany represent the entire workforce. They are very cooperative and work in parallel with the company's interests. Approximately 25 percent of the white collar workers are represented by a union and about 75 percent of the blue collar workforce is represented by the union.
A continuing theme we have witnessed is that there are very few women are in the workforce. The employees are asked to handle a number of jobs on rotation, including some manual, heavy labor. We only saw three women working in the plant during our tour.
DaimlerChrysler looks at "right-to-work states" when considering where to re-relocate in the United States. They feel that it is a very important component to consider when looking at expansion opportunities.
Most surprising is the fact that they don't use water at all in the plant. They use mineral oil instead to lubricate the engines. It's the same compound they have used since 1995. It requires a very elaborate vapor suppression system to prevent fires.
Many of the DaimlerChrysler representatives we met with today were unable to comment on the news and the pending deal. It was somewhat apparent, however, that the cultures of the two companies, Daimler and Chrysler, never fully blended.
We ended the day with an authentic dinner at a lovely restaurant called Wirtshaus in Frankfort. We had a traditional dinner of sauerkraut, sausage, pretzels, flatbread, asparagus and goulash. The delegates spent the dinner discussing the Chrysler news and the economic opportunities for our state. We were all incredibly impressed with the DaimlerChrysler plant.
Monday, May 14, 2007
Day Two:
We had a briefing this morning from various government officials in Germany. It was fascinating. As you may have heard by now, Cerberus, which is a venture capital firm, is close to signing a deal with Chrysler. We are meeting today with the Chairman of Chrysler, Dr. Dieter Zetsche. Our meeting is on the heels of this big announcement. The entire delegation will tour the plant in Stuttgart, Germany.
Transportation is key for Germany. The Frankfort airport is the number one airport for freight delivery for all of Europe. It's the number two passenger airport. They have a high-speed train system as well. Germany is really a transportation hub within all of Europe. It has transformed the country's economy.
Germany has a leading stock exchange and every two years hosts the largest auto show.
They have adapted their economy. They were really heavy in the manufacturing sector but not anymore. Indiana can learn a lot as we also need to adapt to a change in the environment and learn how to become a more globalized market.
Individual states don't levy taxes, they are instead levied on a federal basis.
Germany is the leading exporter of manufacturing goods of anyone in the world, with the US being second. The German economy is less sensitive to energy crisis'. They are on a strong economic footing now.
There are two major political parties in Germany. They are very pro-American. The US and EU just entered into the first Air-Transic agreement between the US and EU. Before there were numerous agreements with some countries but now we have agreements with all countries so it opens up more flights. The Transatlantic Economic Counsel is engaging in discussions about standards between countries, such as selling cars, registering drugs etc.
The top tax burden is about 48 percent. Germans have to pay into a social system with respect to retirement systems, health insurance and unemployment. The cost of gas is $5.50 for regular gallon and $6.50 for super. When German companies invest in the United States they tend to be interested in tort laws and product liability. They are also very concerned about the educational system. It is a very capitalistic society and a number of important trade events take place in Germany.
Everyone is insured and employers and employees contribute equally with respect to insurance policies.
On Sept. 1, Germany will implement a smoking ban due to the European Union.
Soccer and racing are major entertainment events and important pastimes for Germans. Speed is viewed as a real commodity. They drive extremely fast on the road!
There is very little urban sprawl. If you take down a tree, you must plant a tree. Housing is incredibly expensive. The German population is very dense, about 83 million people, and it's a country the size of Montana. German companies are willing to invest in US companies.
The birthrate is very low (1.3 vs. 1.8). Very few women work outside of the home because there is not an infrastructure to support childcare.
The universities are free in Germany. Unlike Asian countries where we saw a number of students come to the states for an education, we don’t see that with Germany.
Transportation is key for Germany. The Frankfort airport is the number one airport for freight delivery for all of Europe. It's the number two passenger airport. They have a high-speed train system as well. Germany is really a transportation hub within all of Europe. It has transformed the country's economy.
Germany has a leading stock exchange and every two years hosts the largest auto show.
They have adapted their economy. They were really heavy in the manufacturing sector but not anymore. Indiana can learn a lot as we also need to adapt to a change in the environment and learn how to become a more globalized market.
Individual states don't levy taxes, they are instead levied on a federal basis.
Germany is the leading exporter of manufacturing goods of anyone in the world, with the US being second. The German economy is less sensitive to energy crisis'. They are on a strong economic footing now.
There are two major political parties in Germany. They are very pro-American. The US and EU just entered into the first Air-Transic agreement between the US and EU. Before there were numerous agreements with some countries but now we have agreements with all countries so it opens up more flights. The Transatlantic Economic Counsel is engaging in discussions about standards between countries, such as selling cars, registering drugs etc.
The top tax burden is about 48 percent. Germans have to pay into a social system with respect to retirement systems, health insurance and unemployment. The cost of gas is $5.50 for regular gallon and $6.50 for super. When German companies invest in the United States they tend to be interested in tort laws and product liability. They are also very concerned about the educational system. It is a very capitalistic society and a number of important trade events take place in Germany.
Everyone is insured and employers and employees contribute equally with respect to insurance policies.
On Sept. 1, Germany will implement a smoking ban due to the European Union.
Soccer and racing are major entertainment events and important pastimes for Germans. Speed is viewed as a real commodity. They drive extremely fast on the road!
There is very little urban sprawl. If you take down a tree, you must plant a tree. Housing is incredibly expensive. The German population is very dense, about 83 million people, and it's a country the size of Montana. German companies are willing to invest in US companies.
The birthrate is very low (1.3 vs. 1.8). Very few women work outside of the home because there is not an infrastructure to support childcare.
The universities are free in Germany. Unlike Asian countries where we saw a number of students come to the states for an education, we don’t see that with Germany.
Day One:
We left Indianapolis around 3pm and landed in Frankfort, Germany after an easy and nice flight. It's a fascinating airport. The airport is huge, one of the largest in the world. There was surprisingly very little security. There are 60,000 people employed at the airport (the population of Frankfort is only 650,000) so it is a huge airport for the size of the city. Frankfort is a very European city. Very progressive and cosmopolitan.
Ninety percent of the city was destroyed during World War II. It has more sky-scrapers than any other city in Germany. There is also an old-town with cobblestone streets reminiscent of the pre-world era. We're staying in Hotel Heffischerhof, a beautiful antique hotel.
Today we took a tour of the city of Frankfort. There were German immigrants who re-located in 1848 and those families that came to Indiana, at that time, after the revolution founded the Athenaeum. The service here is impeccable. Everyone is very responsive and hospitable.
We are visiting in Frankfort at the time of the Skyscraper Festival. This is the first time they've held the festival since 9/11. People are parachuting and rappelling from the skyscrapers. There are wires between the towers with motorcycles crossing between the buildings! There are bikes riding up the skyscrapers and thousands of spectators, as you can imagine.
It is estimated that 1.2 million people will visit Frankfort over the 2-day festival.
We had dinner with the Governor and the Minister for Federal and European Affairs, Volker Hoff. It was a wonderful dinner of perch, white asparagus, potatoes and apple strudel. The restaurant we ate in was 550 years old.
The Minister spoke a lot about the city of Frankfort. The population is 650,000. They have an exchange program with state legislatures, which they hope our state legislator's will attend.
There are 29 universities in the city. They have very diversified industries including pharmaceutical and agriculture. The General Consulate is the largest Consulate in the world. They have very close ties with the United States.
Some interesting facts about Germany --- It's about the size of Montana. The capital is Berlin. Hamburg is the largest city, with a population of 1.7 million. The most prevalent religion is Muslim. Life expectancy is about 81 years. Germany has about a 10 percent unemployment rate. Germany is a federal republic with three branches of government, like the United States. The per capita average income is about $28,000. The natural resources are: iron, coal, natural gas and agriculture including corn, wheat, potatoes and barley. The major industries are: iron, steel, coal, chemical, electrical and construction. The major markets include France, US and the UK. The major suppliers are France, US and the Netherlands.
Ninety percent of the city was destroyed during World War II. It has more sky-scrapers than any other city in Germany. There is also an old-town with cobblestone streets reminiscent of the pre-world era. We're staying in Hotel Heffischerhof, a beautiful antique hotel.
Today we took a tour of the city of Frankfort. There were German immigrants who re-located in 1848 and those families that came to Indiana, at that time, after the revolution founded the Athenaeum. The service here is impeccable. Everyone is very responsive and hospitable.
We are visiting in Frankfort at the time of the Skyscraper Festival. This is the first time they've held the festival since 9/11. People are parachuting and rappelling from the skyscrapers. There are wires between the towers with motorcycles crossing between the buildings! There are bikes riding up the skyscrapers and thousands of spectators, as you can imagine.
It is estimated that 1.2 million people will visit Frankfort over the 2-day festival.
We had dinner with the Governor and the Minister for Federal and European Affairs, Volker Hoff. It was a wonderful dinner of perch, white asparagus, potatoes and apple strudel. The restaurant we ate in was 550 years old.
The Minister spoke a lot about the city of Frankfort. The population is 650,000. They have an exchange program with state legislatures, which they hope our state legislator's will attend.
There are 29 universities in the city. They have very diversified industries including pharmaceutical and agriculture. The General Consulate is the largest Consulate in the world. They have very close ties with the United States.
Some interesting facts about Germany --- It's about the size of Montana. The capital is Berlin. Hamburg is the largest city, with a population of 1.7 million. The most prevalent religion is Muslim. Life expectancy is about 81 years. Germany has about a 10 percent unemployment rate. Germany is a federal republic with three branches of government, like the United States. The per capita average income is about $28,000. The natural resources are: iron, coal, natural gas and agriculture including corn, wheat, potatoes and barley. The major industries are: iron, steel, coal, chemical, electrical and construction. The major markets include France, US and the UK. The major suppliers are France, US and the Netherlands.
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