Central European countries: production of VW's subcompact Up! surges in Slovakia
Daimler manufactures B-Class in Hungary; Fiat/GM production declines in Poland
This Report outlines the recent activities of OEMs that produce vehicles in six Central European countries (Czech, Poland, Slovakia, Romania, Hungary, and Slovenia) (We added two countries - Serbia, where Fiat boosts production capacity, and Bulgaria, where Great Wall Motor builds a new plant).
In these six countries, more than 3 million vehicles were produced per year from 2007. Production fell temporarily in 2009 due to recession, but in 2010, 3.42 million vehicles were produced. Yet, in 2011, due to concerns over financial credibility, sales in Europe, the largest export destination, fell and production declined slightly to 3.39 million units. In the first half of 2012, production fell by 2% y/y to 1.77 million units.
Production in each country showed mixed results. In Slovakia, where VW produces the up! subcompact car and Kia produces the Sportage SUV, production in the first half of 2012 increased substantially. On the other hand, production fell in Poland, where Fiat, whose sales declined significantly in Europe, and FSO (which produces GM models) have plants. In Czech, where Skoda and Hyundai have production facilities, production fell slightly, but Czech is still the biggest car manufacturing country in Central Europe.
The average wage in Central Europe is said to be one fifth of that in Germany. The importance of the region as a production site of vehicles has been increasing and production has been transferred from Western Europe. OEMs that recently built new production facilities in Central Europe include Daimler, which began production of the New B-Class at a new plant in Hungary in March 2012, and Great Wall Motor, which officially started operations of its KD plant in Bulgaria in February of the same year. Concerning plans to boost production capacity, Audi will increase production capacity in Hungary to 125,000 units/year (41,000 units in 2011) by 2013 and Fiat will upgrade its plant in Serbia to boost production capacity to 200,000/year (10,000 units in 2011).
Related Reports: Six central European countries (Jul. 2011)