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Crisis starts to affect carmakers

THE SLOVAK automotive industry has not escaped the effects of the global financial crisis.

THE SLOVAK automotive industry has not escaped the effects of the global financial crisis.


The three main carmakers operating in Slovakia - Kia Motors Slovakia in Žilina, PSA Peugeot Citroen in Trnava and Volkswagen in Bratislava – have already acknowledged some problems as all of them export most of their products abroad. This year, about 600,000 cars should roll off production lines at the three companies’ plants, the ČTK newswire reported, citing figures from the Automotive Industry Association of Slovakia (ZAP).

Originally, the three carmakers planned to extend overall production to 675,000 units this year, up from last year’s total of 572,000.

“From the viewpoint of the car industry, plans from the beginning of this year will not be fulfilled,” Jozef Uhrík, ZAP’s president told journalists on November 19. He added that lower orders and potential lay-offs could affect some of the carmakers’ suppliers.

“The financial crisis has influenced the company on the production side since demand for new cars is decreasing significantly in Western Europe, where we send most of our output,” Dušan Dvořák, spokesperson for Kia Motors Slovakia told The Slovak Spectator. “We must thus adjust our production plan continuously according to the number of orders. For December we have so far recorded a lower order compared to the plan.”

Planned production cuts by French concern PSA Peugeot Citroen will not significantly affect its plant in Trnava.

“Measures to reduce production will not affect all plants and regions equally,” said Peter Švec, spokesperson for PSA Peugeot Citroen Slovakia, as quoted by the SITA newswire in late October. “Our plant has a competitive advantage in that it manufactures the Peugeot 207 model, which is the third-best selling car in Europe.”

The Trnava plant produces smaller cars, with engines which consume less fuel and have lower CO2 emissions, and are thus less affected by current swings in the market, according to Švec.


“Up to the end of the year we will not take any measures to change our position and will keep to the production plan for 2008, which is for almost 200,000 cars,” said Švec.

Volkswagen in Bratislava, which manufactures more expensive models such as the VW Touareg, Audi Q7 and Porsche Cayenne has announced some decreases in production, according to Uhrík.

The Slovak branch of the German carmaker has cancelled night-shift production of the VW Touareg and Porsche Cayenne and also intends to set a longer Christmas break for employees, the Pravda daily wrote in early November.

Due to the crisis, neither PSA nor Kia will add a third shift as originally planned, according to Uhrík.

The Trnava carmaker, which is now working in two shifts, has cancelled the Friday afternoon shift as of November, but according to Švec this is allowable within its flexible working time arrangements. He added that the measures would not affect the wages of employees nor the number of positions. The company employs 3,3000 people, SITA wrote.

“Kia Motors Slovakia has a labour force of over 2,800 permanent workers and it does not plan to change this,” Dvořák told The Slovak Spectator.

The long-term vision of the South Korean company branch in Slovakia remains to increase production to make full use of its factory’s annual capacity of 300,000 cars, as well as to make a further investment in Slovakia in the form of an engine-making plant.


Topic: Industry


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