ABB, a Swedish-Swiss multinational corporation, is investing in China in the construction of a new flexible automated robotics factory and also in the purchase of a previously leased major property.
But the company‘s capital expenditures in 2021 remained focused on mature markets, reflecting the geographic spread of its existing production facilities.
Capital expenditures in Europe and North America in 2021 were primarily driven by upgrades and maintenance of existing production facilities, primarily in the United States, Austria, Italy, Switzerland, Finland and Sweden.
Capital expenditures in Austria included continued investments in the state-of-the-art innovation and training campus, which is planned to become one of its largest research and development centers for new automation technologies.
ABB is also building a new facility in Italy for its electric mobility division.
This investment is intended to serve as a global center of excellence and production site for electric vehicle charging infrastructure.
On the other hand, its capital investments in emerging markets continued to be mainly concentrated in China and focused on increasing existing production capacity.
The share of emerging market capex as a percentage of total capex in 2021 and 2020 was 33% and 22%, respectively.
At the end of 2021, construction in progress for property, plant and equipment was $522 million, mainly in the United States, Switzerland, Germany, Sweden, Italy, China and India.
For comparison: As of December 31, 2020, the Company’s property, plant and equipment construction in progress was $505 million, primarily in the United States, Switzerland, Austria, Germany and China.
Its capital expenditures relate primarily to property, plant and equipment and are financed for the most part through cash flows from operating activities.
By 2022, ABB estimates that property, plant and equipment expenses will be higher than its annual depreciation and amortization charge, excluding acquisition-related amortization.
ABB operates in more than 100 countries in three regions: Europe, the Americas and Asia, the Middle East and Africa. It is headquartered in Zurich, Switzerland.