Europe is no longer a patchwork of countries, languages and cultures. Companies are finding that a well-placed strategic location can best suit corporate needs for not only a European headquarters, but also regional offices. Rather than selecting specific countries, companies are looking more to cluster in locations where their industry sector is strong and developed.

Scandinavia offers an excellent location for information technology (IT) companies wishing a regional approach to the Northern European market. Sweden's IT clusters are attracting the leading international companies in wireless, telecom and telematics.

Linksys, a U.S. manufacturer of hardware for wireless systems, has established headquarters in Stockholm to serve the Scandinavia market.

Kista, outside of Stockholm, has become the world's No. 3 technology hub and one of the world's largest IT clusters. Sun Microsystems located its Wireless Center of Excellence there.

Capitalizing on the success of its e-fulfillment center in Miami, the American Express Interactive Travel Group is pursuing wide-scale development of its interactive solutions by opening the second of two pan-European centers at Sophia Antipolis in France's CÙte d'Azur. The staff will ultimately increase from 25 to about 100 following a regrouping of the other Havas American Express teams based on the CÙte d'Azur.

Last August, a similar center opened in Stockholm to handle transactions for clients in Sweden, Norway, Denmark, Finland and the Netherlands. The center at Sophia Antipolis covers the French, German, Belgian, Spanish and Italian markets.

What makes the location special? The CÙte d'Azur area, with its 1 million multinational population, offers major elements required to be one of the major areas of IT development in Europe: a distinct quality of life; an international land of creativity; Europe's foremost Science Park — Sophia Antipolis; state-of-the art infrastructures; and expertise in the IT field.

American Express also selected Madrid for a call center to cover France, Germany and Sweden. The company determined that Madrid boasts the largest pool of staff in Spain for a call center covering the German market.

Similarly, Madrid was chosen by Terremark (operators of the Network Access Point for the Americas, based in Miami) for its first NAP in Europe, largely because of its telecommunications infrastructure.

Terremark will initially invest $10 million in the project, and increase this to $200 million when related, follow-on investments are needed. When completed in 2005, NAP should employ 1,200 people.

Intel chose Barcelona for its first European microprocessor design laboratory. The lab is located at the Polytechnic University of Catalonia, which is known for microprocessor research.

Biotech and Medical Devices

Celltech Group recently announced that it has chosen Copenhagen as its base for expansion into the Nordic region. Its reason: to create a network with other biotech companies around what has been dubbed the Medicon Valley.

Medicon Valley, which incorporates Copenhagen in Denmark and Skane in Sweden, is a leading leading center for biotechnology. That, plus Copenhagen’s central Northern European location, flexible labor market and airport, were major factors for the decision.

Microlife Ltd., the world’s largest manufacturer of digital thermometers and home diagnostic products, recently expanded its operations in St. Gallen, Switzerland, to include global marketing activities and the headquarters for Europe and Africa.

Morton Brunvoll, Microcline’s head of global marketing, said several reasons for the selection.

“First, we can rely on a large number of well-trained professionals, reliable suppliers and partners,” he said. “In addition, we’re a multicultural organization. We have R&D in Asia, the U.S. and Europe; manufacturing in China; the home office in Taiwan; and global marketing in Europe. And the Rhine Valley is a down-to-earth region. Our products combine high reliability with direct benefits for users. The Rhine Valley has little use for voodoo economics, and that sits well with us.”

Lilly opened its $20 million Medical Chemistry Research Center in Madrid, the group's most important research center outside the United States. The center is charged with quality assurance for the European Union, and Eastern European and African research activities.

"During the past few years, Spain has taken great steps in biomedical investigation and boasts highly experienced chemical researchers,” said Sidney Taurel, chairman of Lilly. That's why we've decided to locate this center in Madrid."

Pfizer increased its R&D activity in Madrid in 2002 and is set to expand still further in 2003. Once its merger with Pharmacia receives final approval, the R&D activities of Pharmacia, currently in Barcelona, will be moved to Madrid (with the exception of two small units).

Automotive

Bavaria is a well-known center for automotive-related headquarters and operations. The automotive sector is one of Bavaria's strongest with BMW and Audi at the helm, reasons enough for TRW to located there.

Cologne’s Ford-Werke AG, the biggest U.S. investment in Germany, has invested more than $500 billion in the construction of its plant in its Supplier Park. Capacity is expected to be 400,000 cars per year.

Ford’s decision to locate engine production in Bridgend, Wales, is a major coup. The $60 million investment will also produce engines for Volvo, Jaguar and Land Rover.

Delphi is looking to invest in its plant in Sant Cugat del Valles (Barcelona) where it manufacturers the latest generation of common rail diesel engines. Delphi expects to build up its technological development soon.

Other Businesses

Office and packaging products manufacturer Avery Dennison Corp. decided late last year to invest an additional $50 million in its facility near Rodange, Luxembourg, to double its production capacity.

"Luxembourg's central location, excellent transportation system and skilled work force enables Avery Dennison to quickly meet customer demand for pressure-sensitive materials," said Dean A. Scarborough, president and CEO of the company. "Expansion of our pressure-sensitive materials production capabilities in Luxembourg positions [us] to provide our customers with enhanced product and service offerings as demand for pressure-sensitive materials grows throughout the EU."

Corum Group, a provider of merger and acquisition services to software and information technology companies worldwide, chose Zurich, Switzerland, for its international headquarters.

“Leading criteria search were neutrality and international posture," said Bruce Milne, Corum Group’s founder, president and CEO. "Of the countries considered, only Switzerland met these requirements. The international business for Corum had grown to more than 40 percent of its volume and needed additional resources outside of the United States to serve its international clientele.”

Other pluses were Switzerland's multilingual work force.

IAMS chose Coevorden (Drenthe), the Netherlands, as the location for its new European pet food production facility.

“Coevorden puts IAMS in a central position close to our distributors,” said Rob Heutink, plant manager. “We found well-educated and highly motivated personnel. Furthermore, we have extensive possibilities for expansion right next to the new facility.”

Karen E. Thuermer is a freelance writer based in Alexandria, Va.