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Government helps Volkswagen with “significant investment” statute

CABINET ministers approved a proposal to issue a certificate of significant investment for Volkswagen Slovakia (VW) on March 18. 

Students will work directly in firms.(Source: SME)

The certificate simplifies the settlement of ownership relations for the preparation of projects, which are a significant investment. It also serves as a document that the company attaches to the application for the start of urban planning in the development process.

The Economy Ministry said that this investment project of the carmaker concerns an extension of the existing plant and boosting production capacity. The result should be a new assembly hall.

“The applicant paid the highest sum of corporate income tax for the year 2013 of €130.67 million and had one of the highest sales and revenues, of more than €6.5 billion," the ministry argues in its proposal, as quoted by the Pravda daily.

“This will help us in various administrative and legislative proceedings connected with the construction of a new assembly hall,” Volkswagen Slovakia spokesman Vladimír Machalík told Pravda. Thus, the plant has not asked for any tax vacation or financial investment aid.

To receive this status, VW has to invest at least €100 million and create more than 300 new jobs, the daily wrote.

The oldest carmaker in Slovakia, Volkswagen Slovakia, manufactured a total of 394,474 automobiles in 2014, a drop from over 426,000 produced in 2013. The carmaker ascribes the drop to the launch of new productions as well as the volatile car market when the decline of car sales on some markets including Russia affected also car production in Bratislava.

Neither the plant, nor ministry have specified so far what will be produced in the new hall, the Dennik N wrote, adding that it could be SUV models. The investment may be related to the decision that starting in 2017, complete Porsche Cayenne cars will be produced in the Bratislava-based plant. At present only bodyworks for these models are made here, while the cars are assembled in Leipzig. 

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Topic: Automotive


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