CZECH REPUBLIC Automotive Industry The Czech automotive industry represents one the most developed automotive markets in the CEE region. Based on its long tradition and techni- cal know-how, the Czech automotive sector succeeded in transitioning into a European advanced automotive base while maintaining its attractive quality/price ratio. This is evident in the fact that in 2010 annual produc- tion of passenger cars exceeded one million units for the fi rst time. REASONS TO INVEST IF R&D IS WHAT YOU NEED IN THE CZECH REPUBLIC The modern history of the Czech automotive industry -- Strategic position in Central Europe, direct boasts not only production successes but also access to the EU market of 500 million outstanding results in the fi eld of automotive research consumers and development. Based on the well-established -- Long industrial tradition & developed supplier automotive market and high-level technical education network with one of the world’s largest proportions of graduates, -- Stable business and political environment numerous R&D companies have established branches – EU and NATO membership here. The more than thirty R&D companies that utilise -- Well-developed transport and logistics the country’s industrial potential and highly skilled infrastructure engineers include Porsche Engineering Services, -- Highly educated workforce, good access MBtech Bohemia, Ricardo, Idiada, Swell, Aufeer to university graduates with technical education Design, Valeo, Visteon, Bosch, Continental, Faurecia, -- Strong innovation potential for R&D projects Hella, Honeywell, Siemens, TRW, TÜV-Süd, ZF -- Positive approach of the Czech government, Friedrichshafen and many others. investment support covering up to 60% Technical universities and their R&D centres, such as of eligible costs through a transparent Vehicle Centre of Sustainable Mobility at Czech Tech- system of investment incentives nical University in Prague and other technical universi- -- First-class support from CzechInvest ties in Plzeň, Liberec, Pardubice, Brno, Zlín and Ostra- va closely cooperate with these companies, providing them with the workforce and know-how they need. BASIC FACTS Additionally, CzechInvest provides fi nancial support The Czech automotive sector is largely based on three with the unique opportunity to fund R&D projects also carmakers, namely Škoda Auto (Volkswagen Group), from the national programme following the recent Toyota Peugeot Citroën Automobile (TPCA) and amendment to the Investment Incentives Act in 2012. Hyundai Motor Manufacturing Czech (HMMC). These producers draw resources from a well-developed “What convinced us was the quality of Czech engineers and the long automotive tradition in the Tier 1 to Tier 3 supplier network which includes fi rms Czech Republic. For this reason we can promise such as Aisin, Bosch, Continental, Denso, Faurecia, further improvements in our results and achieve Johnson Controls, Magna, TRW Automotive and many competitive prices.” others. In 2011 and 2012, overall production of Clive Hickman, passenger cars reached nearly 1.2 million units. Managing Director, Ricardo Vehicle Engineering The automotive industry employs more than 260,000 people and accounts for more than 20% of both Czech manufacturing output and exports. PRODUCTION FACILITIES The Czech automotive industry has a strong manufac- R&D and Technology Centres 2003-2012 turing base. But the sector consists of more than just the passenger-car segment. Heavy- and medium-duty Number of projects trucks, buses and motorcycles are also manufactured Number of companies here. Heavy-duty trucks are manufactured mainly 21 UK 25 by the company Tatra, which is one of the world’s Czech 14 oldest vehicle manufacturers. Avia produces medium- 15 Republic duty trucks in the city of Prague and was acquired 14 Hungary 10 by an Indian company, Ashok Leyland, in 2006. Bus 7 manufacturers include Irisbus Iveco (the former Poland 9 Czech company Karosa), SOR Libchavy, Ekobus 9 Romania 5 and Evobus, a Daimler Buses subsidiary. 2 Slovakia 3 “The Czech Republic attracted us mainly by its 2 remarkable engineering tradition and high level Russia 2 of technical education. This is what we looked Note: Incomming R&D Projects in Selected Countries. for. We are also very satisfi ed with the quality Data include projects in Research and Development Centres, Technology Centres and Design, Development and Testing in period Jan 2003 - Sept 2012. of the local component manufacturers.” Source: fDi Markets, 2012 Jean-Martin Folz President of PSA Peugeot Citroën 1897 1905 1920 1936 Tatra’s Präsident Launch of car The Prague 200,282 motor model is the fi rst production Autosalon is ranked vehicles registered passenger car at the company as the third-largest in Czechoslovakia. produced Laurin & Klement automotive fair Top carmakers in Central Europe company (later in Europe after include Praga, subsidiary of the Paris and London Tatra, Škoda Škoda Auto group) and Aero INVESTMENT CASE STUDY CZECHINVEST’S SERVICES Škoda Auto (Volkswagen Group) -- Business Intelligence The entry of the German Volkswagen Group into Škoda -- Consultancy on available financial support Auto did not mean only signifi cant adjustments to the for investment projects latter’s production and know-how but also changes -- Identification of suitable green/brownfield in awareness of the Škoda Auto brand, which is improving sites, production facilities and offices every year. Since 1991, when Škoda Auto became -- Identification of potential acquisition, the fourth brand of the Volkswagen Group, the Czech joint-venture or supplier partners carmaker expanded its operations not only in its three -- Tailor-made visits to the Czech Republic production facilities in the Czech Republic but also in its -- Liaising with government bodies foreign production and assembly plants in Russia and -- AfterCare services India, and also in its partner factories in China, India, Kazakhstan, Slovakia and Ukraine. Škoda Auto has EDUCATION SYSTEM further enhanced its activities in the Czech Republic. The Czech Republic offers high-level technical Besides opening a design centre, Škoda Auto established education at several technical universities evenly a technology centre in Mladá Boleslav in 2008 that distributed across the country, with more than 98,000 delivers R&D solutions for the entire Volkswagen Group. students majoring in technical or science-related fi elds. Over 21,000 graduates enter the workforce every year and the number of technical graduates increases INVESTMENT CASE STUDY by hundreds each year. Hyundai – the most modern car manufacturer Apart from universities, the Czech education system in Europe features other sources of skilled labour, including Another success story began with the announcement specialised four-year secondary schools whose of a EUR 1 billion investment in Nošovice, Moravian- students graduate with the near equivalent of a univer- Silesian region, in 2006. Over the course of 18 months, sity bachelor’s degree. the Korean car manufacturer Hyundai Motor Company built here its fi rst production facility in Europe, which according to expert opinion is the most modern car factory in Europe. The facility Graduates from Technical Faculties produces four passenger-car models in the compact, SUV and MPV segments. Upon initiation of three-shift Students operation in autumn 2011, the maximum capacity Graduates of Hyundai Motor Manufacturing Czech rose 37,333 2001/2002 to 300,000 cars per year. 3,941 41,567 2002/2003 4,257 48,302 2003/2004 R&D CASE STUDY 4,731 Porsche Engineering Services 52,070 2004/2005 Porsche Engineering is a top-quality automotive design 5,485 56,712 2005/2006 and engineering services provider. From the concept 6,397 phase to series production, Porsche Engineering supports 62,975 2006/2007 its customers in the development of components, systems, 8,397 65,562 2007/2008 modules and complete vehicles. Porsche Engineering 11,876 in Prague specialises in complex technical calculations 66,304 2008/2009 and simulations and will expand its competencies in related 14,198 80,245 2009/2010 business areas. Thus, it contributes to the integrated 17,109 engineering services of Porsche Engineering worldwide. 83,626 2010/2011 Through the establishment of its Prague branch in 2001, 17,249 Porsche Engineering participates in the vibrant Czech 98,736 2011/2012 21,622 market. Highly-qualifi ed engineers and an interesting market Note: According to the educational fi elds selected by CzechInvest. Higher number of students and graduates in academic year 2009/2010 with growing technical requirements make the Czech caused by different methodology. In 2011/2012 were caunted also all ICT Republic a perfect location for advanced engineering programmes. services. Source: Ministry of Education, Youth and Sport, 2012 1991 2006 2008 2010 Joint-venture Launch Launch Annual production partnership of production of production of passenger between Škoda at Toyota at Hyundai Motor cars in the Czech Auto and Peugeot Citroën Manufacturing Republic exceeds Volkswagen Automobile, Kolín Czech, Nošovice one million units Group SELECTED AUTOMOTIVE R&D INVESTMENTS AND TECHNOLOGY CENTRES Liberec Region Ústí Region Hradec Králové Region Karlovy Vary Region Prague Pardubice Region Moravia Silesia Region Central Bohemia region Olomouc Region Plzen Region Vysocina Region CZECH REPUBLIC Zlin Region South Bohemia Region South Moravia Region PRAGUE LIBEREC REGION HRADEC KRÁLOVÉ REGION OLOMOUC REGION MBtech Bohemia (AKKA) LIBEREC HOŘICE OLOMOUC Porsche Engineering