THE AUTOMOTIVE INDUSTRY

Transcription

1 THE AUTOMOTIVE INDUSTRY 1

2 Report on the Automotive Industry in the Slovak Republic Slovakia has become one of the leading car producers in Central Europe, mainly owing to the presence of three world-class automotive companies: Volkswagen Slovakia, Bratislava; PSA Peugeot Citroën Slovakia, Trnava and Kia Motors Slovakia, Žilina. Slovakia s development into one of the world s most important automotive hubs began in the early 1990s, when Volkswagen decided to establish a factory for car production near Bratislava. Since then Volkswagen has become the country s largest industrial concern and its leading exporter (accounting for about 19% of total export revenues in 2004). In May 2007 the company passed an important milestone in the number of VW cars produced. Since the start of production, it has now produced more than 2 million cars in Slovakia. Volkswagen s entry into the Slovak market has also attracted other companies and has contributed to strong growth in the car components industry, which increased the value of its output from EUR 621.4m in 1998 to EUR m in Further impetus for growth in both the car-making and car component industries was added by PSA Peugeot-Citroën (France) and Kia Motors (South Korea), both of which started production in PSA Peugeot-Citroën entered Slovakia in 2003 after signing an investment agreement with the Ministry of the Economy. The French car producer plans to assemble 450,000 cars yearly in its production facility located just outside of Trnava once it starts using the full capacity of the plant. Another 300,000 finished cars will leave the premises annually of Kia Motors in Žilina. This will increase Slovakia s car production to more than 800,000 units by 2010 and will strengthen the position of Slovakia as the top per-capita car producer in the world (the cars per 1,000 inhabitants in 2007 ranks Slovakia first in the world in car production per inhabitant). More car component makers are constantly shifting their operations to Slovakia, to several industrial parks set up near Bratislava, Trnava, Žilina and Martin. Exports from Slovakia s automotive industry reached EUR 16.7bn in 2007, or 39.72% of all Slovak exports. The sector s 2007 turnover was EUR 18.6bn and constituted 35.24% of the nation s total industrial turnover (compared with 14.3% in 1998). At the end of 2007, 75,728 people worked in the automotive sector (compared with 22,000 in 1993). It is estimated that by the end of 2010 the number of workers in the automotive sector will grow to more than 100,000. The industry invested EUR 1,052.6m in 2005 and EUR 1,637.8m in In the car components industry again increased capacities, mainly for supplying the two new car production plants of PSA Peugeot-Citroën and Kia Motors. After 2007 another challenge arose for the entry of new foreign sub-suppliers, who need to be in the vicinity of car makers to ensure fast and exact deliveries in order to support research and development activities through the establishment of strong new R&D centers, competitive policies and innovative strategies for company development. The same opportunity is also offered to Slovak sub-suppliers who are involved in the supply network. One advantage is that the Slovak automotive industry is well diversified, with three different types of car producers and three different groups of car sup-suppliers, all of which are successfully interconnected. While Volkswagen assembles top-end cars, PSA Peugeot-Citroën produces middle-class cars and Kia Motors lower-class models. Moreover, car component producers (with the exception of those short notice producers located in parks next to the car plants) often supply their products to several carmakers abroad and often sell to other industries as well. Therefore, the future of the Slovak automotive industry constantly shows strong growth and development. Industrial sector restructuring and the development of Slovakia s infrastructure are also expected to foster growth in the automotive sector. The construction of a motorway network is being viewed as a priority by the current government, which is hoping to attract strategic foreign investors to bring muchneeded capital into the country s infrastructure, including the transport network. The government aims to increase the motorway network to 834 km by Slovakia is the third-largest vehicle maker in Central Europe. The automotive industry has had an enormous impact on the development of the Slovak economy. The industry has significant growth potential, given its high manufacturing standards and access to both the East and West European markets. More than 316,000 cars rolled off the production lines of Kia, PSA and Volkswagen during the first 8 months of 2007, meaning that during this period the three car producers assembled more cars than in all of By the end of 2007 the number reached a total of 571,071 finished vehicles, and estimates for the year 2008 anticipate an increase by another 70,000 finished vehicles. The increase in production of passenger cars is a reflection of increased demand on the domestic market and on key export markets such as Germany. Slovakia is a net exporter of automobiles, with the 2

3 automotive sector being a large contributor to its foreign-exchange earnings. The Czech Republic and other EU countries are the major export destinations. Planned production of Passenger Cars in the year 2008 Source: ECENTER, Automotive Association of the Slovak Republic PSA Peugeot Citroen Production start up: year 2006 Amount of Investment: Million EUR Workforce: 3, ,800 people Planned production: 300, ,000 cars/year KIA MOTORS CORPORATION Amount of Investment : 1, Million EUR Workforce: 2, people Planned production: 300,000 cars/year 2+1 automobile models Volskswagen Slovakia Amount of Investment : more than 1,300 Million EUR Workforce: 10,000 people in Bratislava, 700 in Martin and 30 in Košice Planned production: 300,000 cars/year 3

4 Automotive Sub-Suppliers The automotive parts industry in the country has flourished with the increase in automotive production. Automotive parts production reached EUR 8,294.6m in 2007, with the bulk of output headed for the Volkswagen manufacturing plants. Major automotive parts manufacturers include Delphi (US), Dura (US), Johnson Controls (US), Faurecia (FRA) and Visteon (US). Component suppliers for the automotive industry VW, a.s. Other producers in mil EUR Component supplies For single producers: VW, a.s Other producers Source: ZAP SR 4

5 Automotive Sub-Suppliers in Slovakia, a Steadily Growing Base Germany: Arnz "FLOTT" Brose C.E.P. Technische Federn Continental Contitech Dura Edscha Eissmann FTE GetragFord Transmission HBPO Heiland Hella Huhn Industrietechnik Knott Kromberg & Schuber Küster Leoni Paul Craemer GmbH SAF - Holland SAS Automotive Sachs Scherdel Siemens Repro Elektronik TÜV International UFT Production Witzenmann France: AFE metal Bourbon Fabi Cemm Thome Faurencia Heuliez Inergy Plastic Omnium Saint Gobain Schneider Electric Valeo Czech Republic: Akuma Aquacomp hard Brano Group Defend Group Faktor Gumotex HP Pelzer Regaz Rubena Italy: Calearo Italian Gasket Magneti Marelli Sistemi Elettronici Prysmian Scanferla ZVL Italia Other EU: Alusil (Austria) Eybl International (Austria) Festo Ges. (Austria) Miba Sinter (Austria) Pankl Automotive (Austria) Fremach International (Belgium) Punch (Belgium) Nissens (Denmark) Clamason Industries (Great Britain) Coba (Great Britain) KTO Technologies (Great Britain) Sigma Q C (Great Britain) SaarGummi (Luxembourg) Technologies Choroni B.V. (Netherlands) Inalfa Metal (Netherlands) Int. Door Company (Netherlands) Roadster Automotive (Netherlands) Solid Semecs (Netherlands) Key Plastics (Portugal) Tersimina (Portugal) Cikautoxo (Spain) Grupo Antolin (Spain) Trelleborg (Sweden) Bibus (Switzerland) Kardex (Switzerland) North America: Magna (Canada) Delphi (USA) J.L.French (USA) Johnson Controls (USA) Lear (USA) Teleflex Automotive (USA) Tower (USA) US Steel (USA - 9% automotive) Visteon (USA) W.H. Brady (USA) Wabash Technologies (USA) World: TSB Bearings Group (China) SIIX Corp (Japan) SEWS (Japan) Yazaki (Japan) Dong Automotive (South Korea) Mobis (South Korea) Glovis (South Korea) Halla Climate Control (South Korea) Hanil (Korea) Sewon Ecs (Korea) Etc. 5

6 The Most Important Automotive Investors in Slovakia Investor Amount of investment (EUR millions) Num. of employees Location Intention Volkswagen, Germany 1,300 10,730 Bratislava Car production Kia, South Korea 1,250 3,250 Žilina Car production PSA Peugeot Citroën, France Getrag Ford Transmissions, Germany Continental Teves, Germany 1,089 4,800 Trnava Car production Kechnec Production of gearboxes Zvolen Visteon, USA Nitra Production of brake components Production of interior parts for KIA and PSA Peugeot Citroën Johnson Controls, USA Trenčín Research & Development Johnson Controls, USA Lučenec Production of seating components Miba, Austria Vráble Production of steel parts Valeo Security Systems, France Košice Key Plastics, USA D. Kubín Production of mechanical parts Production of plastic components Investment into the automotive industry Investment into the automotive industry (thousands EUR) thousands EUR Investment into the automotive industry Source: ZAP SR 6

7 Comparison of industrial production and car production in Slovakia (in bn Eur) Industry SR total Automotive industry Industry SR total Automotive industry Source: ZAP SR Workers in the automotive industry Number of employees * 2009* 2010* Number of employees 50,214 54,680 55,000 57,376 66,875 75, , ,728 Source: ZAP SR * estimated to

8 Cooperation with educational institutions Slovak specialized secondary schools and universities have started a vast cooperation with automotive companies and regional municipalities. This cooperation is mainly made through the establishment of new educational facilities and laboratory centers and the development of educational study programs which are created to simulate real production to enable students to learn under real conditions and hence to be prepared practically for real life in companies. Education in automotive specialization at the University level Slovak Technical University in Bratislava ( Faculty of Mechanical Engineering: Study programs: Automobiles, ships and combustion engines; Mechatronics; Process engineering; Production engineering and quality management; Applied mechanics; Automation and Informatics of machines and processes; Automatic production systems Faculty of Electrical Engineering and Information Technology: Study program: Automotive electrical engineering Faculty of Architecture: Study programs: Product design, Interior design Academy of Fine Arts and Design in Bratislava ( Study program: Industrial design Technical University in Kosice ( Faculty of Mechanical Engineering: Study program: Automotive production Faculty of Electrical Engineering and Informatics: Study programs: Electrical engineering, Informatics and control systems in mechatronics, Automotive electrical engineering, Automotive mechatronics Faculty of Arts: Study program: Design Alexander Dubcek University in Trencin ( Faculty of Mechatronics: Study program: Automotive mechatronics University of Zilina ( Faculty of Operational and Economical Transportation: Study programs: Road transport, Railway transport, Air transport, Professional pilot, Transport engineering Faculty of Mechanical Engineering: Study programs: Technology and machines for transport; Vehicles and engines 8

9 Education in automotive specialization on the specialized secondary school level Pilot centers Pilot center characteristics: A Pilot center is represented by an already existing school founded by a self-governing region where expert educational activities are granted by ZAP SR (Automotive Industry Association of Slovak Republic) and CPA SR (Association of Dealers and Motor workshops of Slovak Republic) and the increasing of a teacher s professionalism is insured by ŠIOV (State Vocational Education Institute), Methodic centers and a Lector center. Goal of the Pilot centers Enhancement of new graduates preparedness, retraining of the registered unemployed, lifetime education of teachers, lifetime education of methods engineers from practice, Creation of a center for lifetime expert education, Advocacy of educational directness for the existing needs of the labour market, Expert education accepted and authorized by the European Union, Pedagogical-educational activities aimed at adjusting expert education quality for requirements of employers and the building-up of new personnel for the needs of the automotive services and car dealers in car repair specializations. List of Pilot centers: Name of Center Pilot center Bratislava Pilot center Senec Pilot center Trnava Satellite Pilot center Galanta Pilot center Nové Zámky Satellite Pilot center Nitra Satellite Pilot center Zlaté Moravce Pilot center Trenčín Pilot center Banská Bystrica Satellite Pilot center Lučenec Pilot center Martin Pilot center Prešov Pilot center Košice School SOU of mechanical engineering, J. Jonáša 5, Bratislava ZSŠ Senec, Kysucká 14, Senec SOU of mechanical engineering, Coburgova 39, Trnava ZSŠ of trade and services, Z. Kodálya 765, Galanta ZSŠ of transport and services, Jesenského 1, Nové Zámky SPV Nitra, Ďurčanského 2, Nitra ZSŠ Zlaté Moravce, SNP 2, Zlaté Moravce SOU J. Ribaya, Partizánska cesta 76, Bánovce nad Bebravou SSŠ Banská Bystrica, Školská 7, Banská Bystrica ZSŠ of services, Zvolenská cesta 83, Lučenec ZSŠ of transport, Zelená 2, Martin-Priekopa SOU of transport, Konštantínova 2, Prešov SOU of transport, Moldavská cesta 2, Košice Lector center The Lector center serves as a transferring system for skills, knowledge and information from manufactures and importers to students through lectors who pass this information on to teachers and pedagogues. The primary goal of establishing a lector center is to overcome the current limitation of knowledge and skills with modern trends of technological procedures as well as work with the most modern equipment and machinery presently used in the automotive industries by pedagogues of specialized subjects, teachers of specialized trainings and methods engineers from practice. After finishing this step, lifetime education will then start. The Lector center is located in the basement of the Pilot center Senec. 9

10 Sector SWOT analysis Strengths - Strategic location between West and East Europe with possible development on the East - Bratislava, Poprad, Zilina and Kosice International Airports and in close distance Vienna International Airport (within 30 min. travel) - Stable macroeconomic environment - Strong engineering tradition - Traditionally quality technical education and developed R&D network - Presence of world-class automotive companies - Favourable labour costs and high labour productivity - Automotive Industry Association of the Slovak Republic (AIA SR) - strong and respected professional association supporting the automotive industry in Slovakia Opportunities - New supplier opportunities due to relocation of global automotive and electronics industries towards CEECs - Support for the innovative environment in the automotive industry - Emerging automotive and machinery/electronics clusters (North-East Slovakia) with strong domestic supplier base - Strengthening cooperation between automotive producers, sub-suppliers, engineering companies and universities as well as the openness of universities towards cooperation with industries - Opportunities for the creation of new applied research institutions and research institutions - Taking advantage of research networks under the EU framework programs with strong support and interest in establishing new R&D centers Weaknesses - Educational system suffering from insufficient financing, insufficient involvement of private financing - Not utilizing the R&D potential of local universities and R&D institutions - need to renew measuring apparatus and equipment for research and development at Universities Threats - Unbalanced external dependency of the automotive sector - Automotive industry is very concentrated in Bratislava and Trnava regions and due to this fact is raising issue of insufficient skilled labour force here 10

11 Slovak Investment and Trade Development Agency Martinčekova Bratislava Slovak republic Tel: Fax: sario@sario.sk 11