Economy Of Villach
Villach is located at the intersection of three cultures and three countries, making it a cosmopolitan and diverse city. It is also situated on the Drau River, at the western edge of the Klagenfurt basin, which provides a favorable climate and fertile soil for agriculture. Villach has a long history of trade and commerce, dating back to the Roman times, when it was a station on an important road connecting Italy and Noricum. Villach was also a medieval stronghold and a center of the Protestant Reformation in the 16th century. In the 19th century, Villach benefited from the development of the railway network, which connected it to Vienna, Venice, and Trieste. Villach was heavily damaged during World War II, but recovered quickly and became a modern and prosperous city.
Economic Sectors
Villach’s economy is characterized by a balanced mix of traditional and innovative sectors, as well as a high level of research and development. Villach is home to some of the world’s leading companies in the fields of microelectronics, engineering, chemicals, and biotechnology, such as Infineon, Lam Research, 3M, Imerys, and Flowserve. Villach is also a hub for start-ups and creative industries, offering a supportive environment and a large pool of skilled workers. Villach hosts several research institutes and centers, such as Silicon Austria Labs, Carinthian Tech Research, and Lakeside Science and Technology Park, which foster collaboration between academia and industry. Villach is also a popular tourist destination, attracting visitors with its historical and cultural attractions, its thermal spa, its lakes and mountains, and its festivals and events. Villach’s tourism sector contributes to the city’s income and employment, as well as to its international reputation and visibility.
Economic Performance
Villach’s economic performance is impressive and above the national and regional averages. According to the latest data from 2019, Villach’s gross domestic product (GDP) per capita was 51,900 euros, which was 18% higher than the Austrian average and 35% higher than the Carinthian average. Villach’s GDP growth rate was 3.2%, which was also higher than the national and regional rates. Villach’s unemployment rate was 5.6%, which was lower than the Austrian and Carinthian rates. Villach’s labor force participation rate was 64.4%, which was higher than the national and regional rates. Villach’s economic structure is also diversified and resilient, with a high share of high-tech and knowledge-intensive sectors, as well as a low dependency on external markets.
Number of Companies and Employees
One of the indicators of Villach’s economic vitality is the number of companies and employees in the city. According to Statistics Austria, as of May 15, 2001, there were 3,234 companies in Villach, employing 32,133 people. Of these, 15 companies had more than 200 employees each, making them large companies in the city.
However, in the following decade, Villach experienced a significant increase in both the number of companies and employees. As of October 31, 2011, there were 4,687 workplaces (companies) in the city, with a total of 36,884 employees (of which 33,831 were employed). This represents an increase of 45% in the number of companies and 15% in the number of employees in 10 years.
The growth of Villach’s economy can be attributed to several factors, such as the expansion of existing businesses, the attraction of new investments, the development of new sectors, and the support of public policies and initiatives.
Commuting Patterns
Another aspect of Villach’s economy is the commuting patterns of its workers. Villach is not only a place where people work, but also a place where people live. Therefore, it is interesting to examine how many people commute to and from Villach for work.
According to Statistics Austria, as of October 31, 2011, there were 8,825 Villachers who commuted to work outside the city, while 18,225 commuters from other places came to work in Villach. This means that Villach had a positive commuting balance of 9,400 people, meaning that more people came to work in Villach than left the city for work.
This shows that Villach is an attractive and competitive location for employment, offering a variety of opportunities and benefits for workers. Villach also serves as a regional hub for economic activity, connecting with other cities and towns in Carinthia and beyond.
Leading companies in Villach
Villach, a key industrial hub in Carinthia, hosts several major industrial players. Siemens AG initiated diode production in 1970, with wafer production starting in 1979 and the establishment of a microelectronics development center. Over the years, Siemens expanded its presence in Villach, becoming one of the city’s largest employers. Since 2000, Infineon Technologies AG, stemming from Siemens’ semiconductor division, has operated Villach as a competence center for automotive and industrial electronics. Infineon’s significant investment of 1.6 billion euros in 2018 aimed to enhance the site, culminating in the opening of a new plant in September 2021.
The decline of the Magdalen pulp mill in the late 1980s was marred by a scandal that reverberated through Carinthian state politics. The tpv Technology Park Villach serves as a high-tech hub in the Alps-Adriatic region, focusing on (micro)electronics, renewable energy, geoinformation, and communication technology. It houses institutions like the Carinthian University of Applied Sciences and Silicon Austria Labs.
Villach also hosts a branch of the American high-tech group Lam Research following its acquisition of the SEZ company in 2008. United Kärntner Breweries AG, known for beer brands like Villacher Bier and Schlachte Bier, contributes to Villach’s industrial landscape.
Additionally, several other prominent industrial companies operate in Villach:
- Imerys Fused Minerals Villach (formerly Treibacher Schleifmittel) specializes in synthetic corundum production, including a dedicated research center.
- 3M Villach (formerly Rappold Winterthur) focuses on grinding and cutting wheel manufacturing.
- Flowserve Villach manufactures control valves for pipelines and other systems.
- Henelite produces varnishes.
- ABC Contract Manufacturing offers services in machining, plastics, mechatronics, assembly, and textiles.
- Ressmann Vehicle Construction.
- Sto Villach produces reinforcement, filler, and facade adhesive.
- Ortner Clean Room Technology specializes in furnishing and equipping clean rooms.
Energy
Villach stands among the distinguished cohort of 24 municipalities in Austria, as of March 2019, that have been honored with the highest accolade from the e5 municipal energy initiative. This pioneering project aims to foster the implementation of cutting-edge energy and climate policies at the grassroots level.
The Villach power plant, situated within the city, has a rich history. Initially established by the ÖDK, it is now under the stewardship of Verbund. Operating in conjunction with the Paternion power plant and the Kellerberg power plant, it constitutes a vital segment of the Upper Drau power plant network. Furthermore, the backwater from the Rosegg power plant extends into Villach’s municipal domain.
Although the Schütt power plant lies entirely within the confines of the municipality of Arnoldstein, it effectively redirects its water around the upper section of the Villacher Gail, contributing indirectly to Villach’s energy ecosystem.
Transport and infrastructure
Villach, has historically been a significant transportation hub, evidenced by relics of a Roman road in the Warmbad region. The city boasts a pivotal role in Austria’s railway network, serving as a junction for several major railway lines. Villach operates as a key hub for the Carinthian S-Bahn, offering frequent connections to Klagenfurt, Spittal a der Drau, and other destinations. Additionally, Villach houses the Villach-Süd marshalling yard, the second largest in Austria, and hosts the Carinthia and Styria operations management center, overseeing the main railway network in both federal states.
In terms of road traffic, Villach is intersected by major highways, including the A2 south autobahn, A10 Tauern autobahn, and A11 Karawanken autobahn, linking the city to destinations such as Vienna, Salzburg, and Italy. The city also serves as a central point for regional road networks, with various motorway exits facilitating access to different parts of Villach and its surroundings.
Parking facilities in Villach include both private and public metered parking spaces, with options for short-term parking zones and free parking areas. Parking tickets can be purchased via mobile phones or through the CityBonus scheme, which allows users to accumulate points for parking time.
Public transport in Villach is operated by Kowatsch, with regular bus services connecting the city center, major railway station, and suburbs. The city’s main train station facilitates national and international train connections, as well as rapid transit lines and regional bus services to neighboring regions and Italy.
Cycling is widely encouraged in Villach, with an extensive network of bike pathways covering over 120 kilometers. The city also supports e-mobility initiatives, including incentives for electric vehicle purchases, the establishment of charging stations, and the introduction of e-scooter rental systems.
Villach’s bridge structures play a crucial role in its transportation infrastructure, with a long history dating back to Roman times. The city maintains 127 bridge constructions, covering approximately 3.3 kilometers, and owns temporary bridge equipment for disaster control purposes.
One notable landmark in Villach is the red Friedensbrücke, constructed in 2004 as part of the city’s commercial and industrial development. This bridge, connecting the St. Magdalen neighborhood with the southern autobahn, received the state building prize in 2005 for its architectural significance and contribution to the city’s connectivity.
