june 1998 cear - auto industry .com · • daewoo slovakia ... • gm to build $130 transmission...
TRANSCRIPT
Ford Bank FinancingPolish Consumers’Thirst for Cars
Car financing in Poland is a fast growingmarket, and Ford Bank Polska is racingto keep up with it. The percentage of newvehicle sales involving financing hasjumped from about 35% in 1995 to some60% in 1997.
Financing companiessuch as Ford BankPolska must contendwith a non-existentcredit checking system,strict Polish bankingregulations, and toughprice competition fromlocal deposit banks.
Ford Bank Polskastarted operations inPoland in September1997 when it wasawarded a bankinglicense andoperational approvalby the National Bank
of Poland. The new bank, a subsidiary ofFord Credit Europe, specializes inoffering financing for new and usedvehicles through Ford dealerships.
Dr Olaf Neitzsch is president of Ford BankPolska S.A. Dr. Neitzsch has worked inPoland for over three years. Prior to hiscurrent position with Ford Bank, he was
Feature Country: Poland• Who Supplies Whom?: p. 5• Optimize Exports to Poland: p. 6• Intellectual Capital — Increasing
Competitiveness: p. 9• Poland’s Economic Zones: p. 10• Today’s Quality Expectations: p. 11• IPP Project Funds Russian R&D for
Auto Companies: p. 14• Tax Benefits Offered in Poland’s
Special Economic Zones: p. 15• Investment Opportunities: p. 17• Distribution of Asian Brands in
Central & Eastern Europe: p. 20• Hungarian Supplier List: p. 21• New Reverse Flow Catalytic
Converter Cuts Emissions: p. 22• Daewoo Slovakia Builds New
Distribution & Service Center: p. 24
BULGARIA CIS CZECH REPUBLIC HUNGARYPOLAND ROMANIA RUSSIA SLOVAK REPUBLIC SLOVENIA
Since 1996
The Source For Automotive Information On Central Europe™
June 1998
On The Web at http://www.cear.com ™
Volume III, Issue 6 ISSN 1088-1123
CENTRALEUROPEAUTOMOTIVEREPORT™
In This Issue
Poland
Standard Products Building In Poland
The Standard Products Co. announced inlate April that it plans to start producingautomotive sealing products in Poland bythe end of 1998. The company hasestablished a subsidiary in Poland and hasacquired land and a partially completedbuilding in the Polish city of Bielsko-Biala.
The 55,000 square foot plant will supplysealing products for all Palio vehiclesassembled in Fiat’s facilities inBielsko-Biala, Poland. StandardProducts intends to expand itspresence in Poland in the futureas customer demand increases.
“The expansion of ourproduction capabilities intoPoland fits perfectly with ourglobal strategy,” said TheodoreK. Zampetis, Standard Productspresident and chief operatingofficer. “Poland is a low-costproducing country located in themidst of the emerging EastEuropean market.”
The Poland plant will be the fifthnew automotive sealing plantStandard Products has added inthe past five years. Since 1993, thecompany has opened new plants in theU.S., Brazil, and Mexico and is currentlyconstructing a new factory in France thatwill replace an older facility.
Standard Products manufactures sealing,trim, and vibration control systems for theautomotive original equipment industry in
Summary
• Standard Products Building in Poland• Hyundai Polish Factory Proposal
Submitted• Cornerstone Laid for $450 million
Daewoo Truck Factory in Poland• Skoda Auto Sales up 27%; Awards
Best Suppliers• Finally: Czech Government to Offer
Investment Incentives• Suzuki Hungary May Invest in More
Capacity• GM To Build $130 Transmission
Facility in Hungary; Astra Phased Out• Big Car Sales Jump in Hungary• VW/Siemens Cabling Systems JV in
Slovakia Boosting Production• Revoz/Renault Replacing Clio with
Clio II Production
Regional MarketHighlights
Profile
Continued on Page 2 Continued on Page 12
Visit the CEAR Central Europe Automotive Forum™ at http://www.cear.com/autoforum or click here CEAR.COM ™
Dr. Olaf Neitzsch
2 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
June 1998Volume III, Issue 6, ISSN 1088-1123
Editorial AssistantBarbora Grossmannova
Research AssistantKatarina Trginova
DesignBig Sky CreativeCaroline Bond,[email protected]
Web Site DesignBig Sky CreativeRon St [email protected]
ReportersCatalin Dimofte, BucharestMagda Sowinska, WarsawPavol Varga, BratislavaBostjan Okorn, Ljubljana
ColumnistsRay Barker, Avon RubberDr. Johan Roos, Intl. Istit. for ManagementDevelopment
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Hyundai Factory in Starachowice
According to Sobieslaw ZasadaCentrum (SZC), the annexes to anagreement for the production of Hyundaicars in Poland were sent to the Ministryof the Economy on April 28. Thedocuments contain a declaration on theconstruction of a welding and paint shop,the scope of “Polonization” of the cars insuccessive years (i.e. increasing theamount of Polish produced parts), andplanned outlays together with aninvestment schedule.
SZC has agreed with Hyundai that thefactory will be located in Starachowice ina special economic zone. According toMarcin Trzaska, SZC press spokesman,from the moment the final agreement issigned, the factory, which will be housedin a hall already owned by SZC, will bestarted up within 18 months. The cost ofthe project is estimated at about DM 120million ($66 million). The Ministry of theEconomy has until May 28 to approvethe annexes.
Eaton in Tczew?
The Polish press has been speculatingabout negotiations between the CarTransmission Factory in Tczew,Poland’s main manufacturer of gearboxesfor trucks, and Eaton Corp. As part ofcomposition proceedings, the factory wastaken over by Sobieslaw ZasadaCentrum (SZC) in 1995.
Speaking with the CEAR, RyszardBartnik, chairman of the board at theTczew factory, denied the rumors.However, Marcin Trzaska, pressspokesman for SZC, confirmed thatTczew is holding commercial andtechnological talks with Eaton.
“Yes, Eaton representatives did visit us,”said Trzaska. “Certain talks are beingheld on cooperation and on the possiblepurchase of a license from thatcompany.”
New Daewoo Delivery Vehicle FactoryUnder Construction
The cornerstone for a new factory
producing Korean cars was laid onApril 30 at Daewoo Motor Polskain Lublin. The planned outlays tostart up production of deliveryvehicles in the new factory amountto $450 million. Of this, $150million will be spent on research anddevelopment work, and the rest onother investments.
In October 1997, Daewoo MotorPoland bought 23 hectares of landnext to its current facility. New hallsfor a welding shop, paint shop, andfinal-assembly facility for the LD-100 delivery vehicle will be built by2000. The total built-over area willbe 93,220 sq. meters.
The LD-100 is a new-generationdelivery vehicle with a total mass ofup to 3.5 tons, designed by Daewooto replace the current Lublin II. TheLD-100 was designed from scratchand the technical documentationprepared at the Daewoo WorthingTechnical Center in the UK by ateam of engineers, designers, andmanagers from England, Korea, andPoland. The Polish group includes150 engineers, 15 of whom workpermanently in England.
The LD-100 van has a load capacityfrom 1 to 1.8 tons, and versionsoffering two axle bases and threeroof heights will be available. Thebasic LD-100 family also includes,apart from a van, 8-15 personmicrobuses, as well as chassis forsingle or double cabs. Availableengines include two turbo-chargeddirect injection diesel engines, with90 hp and 100 hp. The engines willbe compatible with ECE regulationson exhaust purity.
Daewoo plans to cooperate with over100 component manufacturers,including 20 top foreign companies,some of which have declared theirplans to invest in Poland.
The project will create about 30,000new jobs in all the companiesinvolved, including the futuresuppliers of over 15,000 parts andcomponents.
More Market Highlightson Page 4
CENTRALEUROPEAUTOMOTIVEREPORT™
Highlights Continued from Page 1
Ronald F. Suponcic, Jr.Publisher
Jeffrey A. Jones, Esq.Editor-in-Chief
1998EDITORIEDITORIEDITORIEDITORIEDITORIAAAAAL CL CL CL CL CAAAAALENDALENDALENDALENDALENDARRRRR
The Source For Automotive Information On Central EuropeOn The Web at http://www.cear.com
Issue Feature Automotive Reviews Special Reports Close Date
Jan 98 Poland Body/Chassis 1997 Year in Review/ Dec 10, 19971998 Forecast
Feb 98 Hungary Central Europe’s na Jan 10, 1998Executive of the Year
Mar 98 Czech Republic Components & Systems Auto Aftermarket Feb 10, 1998
Apr 98 Slovak Republic Marketing & Advertising na Mar 10, 1998
May 98 Romania/Bulgaria Electronics Auto Consultants Apr 10, 1998
Jun 98 Poland/Slovenia OEM Special: Who Supplies Who na May 10, 1998
Jul 98 Hungary Powertrain Exporting to Jun 10, 1998Central Europe
Aug 98 Not Published
Sep 98 Czech Republic Plastics Auto Engineering Aug 10, 1998
Oct 98 Slovak Republic Logistics Human Resources Sep 10, 1998
Nov 98 Romania/Bulgaria Interiors Real Estate Oct 10, 1998
Dec 98 Poland/Slovenia Financing na Nov 10, 1998
Regular Monthly Columns
Feature Country - featured country market overview and news, plus updates from around the regionProfile Interview - interviews with regional automotive executivesProduct News - information on new products, components, and vehicles in the marketOpportunity Spotlight - regional companies offering investment, joint venture, or partnership opportunitiesQuality Corner - information on improving supplier quality in the regionLegal Advisor - updates on legislation and legal matters pertaining to the automotive industryFocus On Investment - investment analysis of regional automotive related companiesAccounting & Finance - updates on accounting, tax, and customs changes pertaining to the automotive industry
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CENTRALEUROPEAUTOMOTIVEREPORT™
4 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
Tiremaker T.C. Debica IncreasesExports and InvestmentsIn its annual report for 1997, T.C. Debicainforms that it holds a 57% share in thePolish market for first-time tires forpassenger cars, 31% in the market forreplacement tires for delivery vehicles,and 22% in the market for replacementsteel-belted tires for trucks. Debica has a2% share in the European market forpassenger car tires.
According to Zdzislaw Chabowski,Debica’s president, export sales, whichaccounted for 45% of the company’ssales in 1997, will grow faster thandomestic sales. He believes that exportsto Eastern European markets will growthe quickest. Last year, the companyreported sales of 756.1 million zlotys($222 million), of which 101 millionzlotys ($30 million) was sales toGoodyear, the company’s strategicinvestor.
Over the next two years, Debica plans toinvest $50 million into its operations.The construction of a hall for steel-beltedtire production is nearly finished, andproduction lines are being modernized.
Berlingo To Be Assembled By Daewooin Nysa
At the Daewoo-FSO branch in Nysa,negotiations are underway for the start ofassembly of Citroen Berlingo deliveryvehicles. Annual output is planned at5,000 assembled cars. The C-15 modelhas been assembled in Nysa since 1995.
Daewoo — End of Nexia Assembly
Daewoo Motor Polska in Lublinstopped assembling its Nexia model inearly April. Last year, the factoryassembled 18,000 Nexias, and nearly22,000 units two years ago. The Nexia’spopularity decreased after Daewoostarted offering the Lanos.
This does not mean, however, that theNexia will no longer be available inDaewoo showrooms. The model is stilloffered and can be imported if interestgrows. The Nexia is the second Daewoomodel, after the Polonez, that is losingpopularity in Poland the most rapidly,
according to figures released by Samar.
A representative of Centrum Daewoo inWarsaw, who requested anonymity, toldthe CEAR that sales of the Nexia werehigh last year because the companyresorted to substantial discounts in thesecond half of the year. Nexiasmanufactured in 1997 offered for salethis year were also sold at promotionalprices, which led to a sudden drop indemand for the Polonez.
“In some months, the Nexia was cheaperthan the Polonez by as much as 5,000zlotys ($1,500),” said the source. Headmitted that Polonez sales will continueto decrease because the difference intechnical and technological featuresbetween the Nexia, for instance, and thePolonez can span up to 30 years.
The Daewoo FSO press office in Warsawtold the CEAR that the Koreans do notintend to stop manufacturing the Polonezin the Zeran factory.
“We are doing our best to modernize thePolonez, one recent addition being multi-point injection,” said KrystynaDanilczyk, Daewoo-FSO Motor pressspokeswoman. “After all, this is thecheapest family car in the market.”
Daewoo Cuts Prices on Polonez SpareParts
As Krystyna Danilczyk, pressspokeswoman of Daewoo-FSO Motor,told CEAR on April 28, a 10% pricedecrease has been introduced for somespare parts for the Polonez model,including body parts, bumpers,suspension and gearbox elements, andfuel tanks.
Parts for the Polonez truck are alsocheaper, including load-carrying bodysides and floors. According toDanilczyk, Daewoo FSO MotorsAutoparts, which distributes spare parts,is negotiating price decreases with themanufacturers of other parts.
Fiat for the Handicapped
Fiat Auto Poland has introduced anAutonomy Program, through whichphysically challenged people who havedysfunctional lower limbs will be able topurchase certified equipment to assist
them with driving. The equipment willbe available at all Fiat sales outlets.
Petroleum Sector Privatization CouldHurt Car Accessory Makers
The Polish government is preparing forthe restructuring and privatization of thepetroleum sector. Treasury Minister EmilWasacz’s announced in late March thatan oil concern would be established bycombining the assets of CPN SA, thefuel distribution organization, andPetrochemia Plock SA.
This could be bad news formanufacturers of car accessories. Thenew concern would dominate the retailmarket with the 1,350 filling stationsowned by CPN and the 252 stations builtover the past four years by Petrochemia.The powerful company would be in aposition to exert harmful control overprices for accessories and could favorPolish producers over foreign accessorymakers.
Czech Republic
Skoda Auto’s First Quarter Sales Rise
Skoda Auto’s sales were up 27.5%during the first quarter of 1998, totaling86,720 vehicles. Sales of the newOctavia model accounted for 21,853units of Skoda’s total sales.
Sales in the Czech Republic were up8.5% to 20,817 units. Skoda’s largestexport market during the first quarterwas Italy, where 9,879 units were sold,up 126%. Sales in Germany hit 9,737units, Poland 7,421 units, and Slovakia5,836 units.
Skoda expects to sell 410,000 vehicles in1998, a 22% increase from last year’ssales.
Hella & Behr Establishing JointVenture In Czech Republic
In March of 1998, the Germanautomotive systems suppliers Hella KGHueck & Co. and Behr GmbH &Co., established an agreement regardingthe development and production of front-end modules. The two companies willfirst set up a joint venture to supply theCzech carmaker Skoda Auto with front-
Continued on Page 18
Highlights Continued from Page 2
© Central European Trade & Marketing, L.L.C. 1998 http://www.cear.com ™ CENTRAL EUROPE AUTOMOTIVE REPORT™ • June 1998 5
The supply industry in Central Europe continues to blossom, sprouting newproducers, new alliances, and new opportunities. Foreign manufacturers areswarming to the region to supply the local OEMs and Western European basedcustomers.
Domestic suppliers who’ve invested in quality and technology, often with the help ofa foreign partner, are also getting into the action. They’re finding business opportunities with the big OEMs in Central Europe, and a few areeven breaking into the bigger Western European market. The list below provides a quick snapshot of some of the supplier activity in this everchanging market.
Supplier Products Key CustomersAllied Signal, Poland Braking systems FiatAudi Hungaria Motor, Hungary Engines AudiAutoliv, Romania Seat belts Daewoo Automobile RomaniaAutoliv, Hungary Seat belts Autoliv group companiesAutopal/Ford, Czech Republic Lighting systems Ford (Germany, Spain)Barum Continental, Czech Republic Tires Skoda AutoBrano, Czech Republic Locks & other components Skoda, VW, Volvo, Iveco, DAFCZ Strakonice, Czech Republic Turbo chargers & transmissions SkodaDelphi Poland Wiring harnesses Fiat Auto Poland, Ford (Germany)Delphi Poland Heat exchangers Daewoo FSO, Daewoo Motor Poland, Fiat Auto
Poland, OpelDelphi/Packard Electric, Hungary Wiring harnesses BMW, OpelDonit Filter/Filtrauto Filters BMW, Audi, SkodaDraftex-Optimit, Czech Republic Rubber car body sealing systems Skoda, GMElectroprecizia, Romania Alternators DaciaFA Krosno/Delphi, Poland Struts and shocks Daewoo FSO, Daewoo Motor Poland, Fiat Auto
Poland, GM PolandFord Hungaria, Hungary Air-fuel charging assemblies, ignition
coils, fuel pumps, starters Ford plants in Europe and South AmericaGKN Automotive Polska, Poland Driveline and transmission products Fiat PolandHayes Wheels Autokola, Czech Republic Steel wheels Skoda, Audi, VW, OpelHeiland, Slovak Republic Seat covers Johnson ControlsHella Autotechnik Mohelnice, Czech Republic Lights SkodaHuta im Tadeusza Sendzimira, Poland Steel products Fiat Auto Poland, Daewoo, JelczIsuzu, Poland* Engines OpelITT Automotive, Czech Republic Brakes, wipers, motors, shocks Western European companiesITT Automotive, Hungary Windscreen wipers, switches, sensors, Ford, Opel, VW, Fiat, Mercedes, Citroen, Volvo,
electric motors, cables JaguarJohnson Controls, Czech Republic Seats SkodaKosciuszko Steel Mill, Poland Steel products Fiat Poland, Daewoo PolandLear/Emptek, Czech Republic Overhead systems VW GroupLucas Autobrzdy, Czech Republic Braking systems SkodaMagna, Czech Republic Suspension, seat, & brake parts BMWMagneti Marelli Poland Instrument panels, thermal systems,
intake manifolds, exhaust systems FiatMatador Puchov, Slovak Republic Tires Skoda, LadaMezogep Linamar Air pumps Steyr-Daimler-Puch, Transgear, ZFMGM/Daewoo, Hungary Ball bearings Daewoo worldwideMMG Automatika, Hungary Instruments Lada, Magyar SuzukiOpel Hungary Engines OpelPal-Inalfa, Slovak Republic Pre-formed metal components Skoda, Mercedes, Valeo, SuzukiPerion Battery Factory, Hungary Batteries Magyar Suzuki, GM (Hungary)Pilkington Automotive Windshield glass GM PolandPresskam, Slovak Republic Pressed parts SkodaRockwell LVS Liberec, Czech Republic Door & window components Skoda, RockwellSachs Trnava, Slovak Republic Clutches VW, Skoda, Volvo, ZFSaturnus/Hella, Slovenia Lighting systems Hella, Opel, VW GroupShowa Aluminum, Czech Republic* A/C condensers Volvo, AudiSiemens, Czech Republic Wire harnesses BMWT.C. Debica, Poland Tires GM Poland, SkodaTimken, Poland Tapered rollerbearings GM, Ford, Daewoo, VW, FiatTofan Grup, Romania Tires DaewooTRW Autoelektronika, Czech Republic Electric components & switches Audi, Ford, Fiat, Opel, BMWTungsram/GE Lamps Peugeot, Citroen, Renault, Opel, VW, BMW,
Toyota, NissanUBP-Csepel Iron Foundry, Hungary Truck tire hubs Raba, Hungary
Who Supplies Whom?Regional Special Report
Continued on Page 19
6 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
Minimizing Duties on ImportedAutomotive Parts
Amongst the incentives provided forautomotive companies to locate inPoland are the tariff concessions offeredby the government on imported materialsneeded to feed manufacturing operations.Many car parts and sub-assemblies canbe imported duty free into Polandprovided they are used in manufacturingoperations, while others may be importedduty free under tariff quotas administeredby the Ministry of Economy.
At the top of an automotive company’slist of import priorities, therefore, isalways the import classification of theparts which they receive. Theseclassifications will identify those partsthat fall within a duty free category.Poland uses the same basic classificationsystem as other WTO countries — the“Harmonized System” — and the partsfalling into the duty free categoryprimarily fall within Chapter 87 of theTariff.
Duty Free Parts
As many of you may know, theclassification rules can be complex andthe distinction between a car part fallingwithin Chapter 87 and a part which hasto be classified elsewhere is not alwayswell defined. As a general rule,however, identifiable sub-assembliessuch as steering units will go underChapter 87, while engine parts andbearings typically are classified inseparate specific areas of the Tariff. It isusually necessary to have classificationsassessed by an expert familiar with theTariff rules and good practice to haveclassifications confirmed by the MainCustoms Office.
Parts Quotas
For other key parts that don’t fall into theduty free category, a company mustmake sure that applications are submittedto the Ministry for quota allocations.The quota pool is allocated on a
quarterly basis through a system ofimport permits. It is extremely importantto make sure that applications aresubmitted on time. If as sometimeshappens, a company does not getsufficient, or indeed any, quotaallocation, then they have to start payingduty on their suppliesusually at rates of upto 10%, butsometimes more.
Other Options
For the remainder ofparts which may bepotentially liable toduty, the importerthen has two mainpossibilities toexplore:
• Sourcing —Poland has anetwork of trade agreements inplace, notably with the countries ofWestern and Central Europe, whichprovide for preferential rates of dutyon products originating in thosecountries. For example, EuropeanUnion origin car parts normally willbe subject to duty in the range of 0%to 3%, compared to 9% to 15% forparts originating in North Americaor the Far East.
• Duty relief schemes — Dutiablecomponents incorporated intofinished products sent for exportqualify for duty relief under theInward Processing scheme. Theduty payable on the importedcomponents can either be suspendedpending export, or reclaimed afterexport, of the finished product.
The most duty efficient importer ofautomotive parts in Poland is the onewho can pull together these fourfundamental strands into a single dutyminimization plan. For example, ifcertain parts can be traced into exportproduction and thus qualify for dutyreduction on this basis, it may not be
necessary to use up valuable quota onthem.
Simplified Customs Procedures
The process of clearing imported goodsthrough Polish Customs has traditionallybeen extremely ponderous andbureaucratic, involving numerous delays.New legislation was introduced at thebeginning of this year which has partiallyovercome this problem by introducingthe possibility of importers usingsimplified customs clearance procedures.
The essence ofthese procedures isthat authorizedimporters shouldbe able to effectcustoms clearanceat their ownpremises and usetheir internalsystems as much aspossible to producethe informationrequired byCustoms. For theimporter, use ofsimplified
clearance procedures reduces borderdelays, allows more streamlinedproduction operations, cuts out many ofthe costly impediments involved in thetraditional clearance system, and allowsa more controlled and integratedapproach to customs planning to bepursued.
Since the introduction of the legislation,the practical requirements of a simplifiedclearance scheme have been underdevelopment with one of the leading carproducers in Poland acting as the pilot.In March 1998, this company became thefirst company in Poland to be authorizedto operate simplified clearanceprocedures, and now the way is open forother companies to follow suit and takeadvantage of the scheme. In order to dothis, it is necessary to apply to Customsfor authorization.
If the application is allowed to progress,it then becomes a process of developinga customs clearance system thataccommodates simplification withoutcompromising the integrity of Customs’ability to control the flow of imports andexports and to protect the revenuen
How to Reduce Polish Import Duties on PartsPoland Streamlines Customs Procedures
Export/Import Help Desk Andrew Davis, Senior Tax Manager, Price Waterhouse, Warsaw
“New legislation willallow authorizedimporters to effectcustoms clearance attheir own premises anduse their internalsystems to produce theinformation required byCustoms.”
© Central European Trade & Marketing, L.L.C. 1998 http://www.cear.com ™ CENTRAL EUROPE AUTOMOTIVE REPORT™ • June 1998 7
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CENTRALEUROPEAUTOMOTIVEREPORT™
Passenger Cars Light Commercial Vehicles Medium Commercial VehiclesMake Units % Change Make Units % Change Make Units % Change
’98 v ’97 ’98 v ’97 ’98 v ‘97Daewoo Tico 13,171 89.37 FSO Polonez Truck 2,585 -18.69 Daewoo Lublin 2,675 1.06PF 126 11,136 -19.09 Citroen C15 712 -23.61 Mercedes Vito 804 118.48Daewoo Lanos 10,380 - Skoda Pick up 672 111.99 VW Transporter 559 115.00Fiat Cinquecento 9,902 -35.22 Citroen Berlingo 417 13800.00 FSC - Zuk 446 -49.38Fiat Siena 9,681 - Fiat Uno Van 414 -18.34 Ford Transit 370 -35.76Opel Astra 6,198 32.86 GM - Opel Combo 220 -19.12 Iveco Daily 332 114.19FSO - Polonez 5,938 -51.40 Peugeot Partner 166 -25.23 Mercedes Sprinter 207 100.97Skoda Felicia 5,723 21.15 Fiat Cinquecento Van 125 -89.80 Peugeot Boxer 206 171.05Fiat Punto 4,638 0.41 VW Caddy 83 -44.83 Kia Ceres 163 94.05Fiat Uno 4,474 -32.16 FSO Polonez Cargo 77 -25.96 Fiat Ducato 157 -48.86 Source: SAMAR, s.c.
Best Selling Models in Poland (YTD March 1998)
Sales (Units) YTD March1992 1993 1994 1995 1996 1997 1998 % Change vs ‘97
————— Passenger Cars —————Local Production 144,748 170,549 199,724 206,284 260,265 337,467 100,229 24.62%Import 54,531 71,059 50,558 58,754 114,347 140,493 37,296 -25.72%Total 199,279 241,608 250,282 265,038 374,612 477,960 137,525 5.27%————— Commercial Vehicles —————Local Production 19,665 18,475 21,413 28,076 43,207 43,086 9,988 -11.23%Import 3,250 5,497 2,542 3,870 7,586 12,217 2,378 25.09%Total 22,915 23,972 23,955 31,946 50,793 55,303 12,366 -5.98%Source: SAMAR, s.c.
Sales of New Cars and Commercial Vehicles in Poland
8 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
The lack of worker mobility in Central Europe is a big problem for many companies operating inthe region. Companies that I’ve spoken with employ a number of different tactics to overcomethe problem, from busing to home loans.
Ford Hungaria, for instance, operates a factory in Szekesfehervar, 63 kilometers outside of Budapest.To attract engineers and finance people (positions in high demand) at universities in Budapest, thecompany has a special home loan program. According to management, its works out well. The factthat such a program is necessary to attract people that are only 63 kilometers away, should give youan idea of the magnitude of the problem.
This issue was recently addressed in the CEAR Central Europe Automotive Forum (http://www.cear/autoforum) by Elise Ginsburg of Personnel Select in Warsaw. Elise’s comments are quiteinstructive and worthy of repeating:
“[The lack of mobility] has arisen primarily due to a severe lack of housing (especiallyaffordable housing), and family ties (often several generations) to a particular town, city, or region. The situation is alsocomplicated by the fact that in most families in Central Europe, both spouses are bread winners, so that if one spouse has torelocate, it could mean a huge cut in family income if the other spouse cannot find a job.
Add to this scenario the loss of the apartment, which was probably either in the family for years, or was a state apartment whichmeans that the family is paying well-below the market rate for the space, and you can understand why there has been a lack ofinterest in relocation.
Recently, I have seen some innovation on the part of employers to encourage workers to relocate.This may include the company paying the rent on the apartment, providing subsidized loans for thepurchase of a new flat, or paying for weekend flights/train trips home so that the entire family doesnot have to relocate. I have even seen employers, desperate to find highly skilled and trainedemployees (such as in Warsaw), double the salary that they would pay in Warsaw in order to enticethat person to move to Poznan or Lodz. I predict in the next two years that this trend will reverse, andemployees will simply look for the best overall offer, and then choose to relocate for the benefit oftheir career.”
Tips For Success In Central Europe Improving Worker Mobility
Passenger Cars Light Commercial Vehicles Medium Commercial VehiclesMake Units Change Make Units Change Make Units Change
’98 v. ’97 ’98 v. ’97 ’98 v. ’97Units Units Units
Daewoo Lanos 10,380 10380 Citroen Berlingo 417 414 Mercedes Vito 804 436Fiat Siena 9,681 9681 Skoda Pick up 672 355 VW Transporter 559 299Daewoo Tico 13,171 6216 Renault Kangoo Exp. 35 35 Iveco Daily 332 177Daewoo Nubira 3,168 3168 Peugeot 306 XA 29 20 Peugeot Boxer 206 130Toyota Corolla 2,643 2040 Peugeot 106XA 6 5 Mercedes Sprinter 207 104Fiat Palio Wknd 1,794 1794 Seat Inca 33 1 Kia Preggio 83 83Opel Astra 6,198 1533 Piaggio Porter 8 1 Kia Ceres 163 79Citroen Xsara 1,489 1489 Hyundai H100 P/V 96 42Toyota Avensis 1,131 1131 Daewoo Lublin 2,675 28Honda Civic 3,950 1115 Citroen Jumpy 28 28
Source: SAMAR, s.c.
Fastest Sales Climbers in Poland (YTD March 1998)
Jeff Jones
Visit the CEAR Central Europe Automotive Forum™ at http://www.cear.com/autoforum or click here CEAR.COM ™
© Central European Trade & Marketing, L.L.C. 1998 http://www.cear.com ™ CENTRAL EUROPE AUTOMOTIVE REPORT™ • June 1998 9
This new CEAR column will bring youcoverage of cutting edge issues, ideas,and strategies to help you achieveexcellence in the management of yourenterprise. For the next three months,Dr. Johan Roos, Professor of GeneralManagement and Strategy at theInternational Institute for ManagementDevelopment, will discuss how tomaximize the value of your company’sintellectual capital.
Intellectual capital, which includesknowledge, customer relations, supply-on-demand, and micromanagement, isone of the most important andsustainable sources of competitiveadvantage for today’s moderncompanies. Most companies, however,don’t even know how to measure theirintellectual capital. This month, Dr.Roos will provide you with a foundationfor understanding the concept ofintellectual capital and why it isimportant to your company.
Like your company, many of today’s bestcompanies have done their utmost tosqueeze every penny out of their hardassets, physical and monetary. Cycletime has been reduced to the bareminimum, inventory is virtually zero,and investments are carefully selected interms of a balance between short-termand long-term resources.
On the competitive side, multi-milliondollar ad campaigns are launched toconquer every last bit of the potentialmarket, or to scrub away half apercentage point of market share fromcompetitors.
But things are not always what they seemto be in the business world of today.Let’s switch around from a sales andhard asset perspective to one that insteadplaces value creation at the forefront.From the sales and asset perspective,Microsoft’s is not very impressive. Withonly a fraction of the sales and assets ofits industrial counterpart GeneralMotors, however, the market value ofMicrosoft was $200 billion in early1998. This made Microsoft the secondmost valuable company in the US.
It is clear that knowledge, brands,innovation projects, and other ‘invisible’assets enable more wealth creation thanthe classical production factors, andoften much quicker. The reason forCaterpillar to be valued almost fivetimes its hard assets is all of the‘invisible’ value, and potential for newvalue creation stemming from its well-known Cat brand, its unique dealershipnetwork, and the knowledge and skills ofits employees.
The main message of this article series isthat in the modern business world youhave to be even better at managing theintellectual capital of your organization.Good management has become muchmore than management of hard assetsand “human resources”. This is whymanagers on different levels, acrossindustries, and from different countriesare beginning to apply the thinking andpractice of intellectual capital.
The Changing Economy
The global economy is changing. I amnot talking about technological advances,although these certainly had somethingto do with it. The information orknowledge components of products oftoday have dramatically increased. But,why is there an increase in the amount ofknowledge and information circulating inthe business world?
First, technological progress hasrevolutionized the way information isprocessed and stored. Computers haveenabled data processing at low costs andhigh speed, and made it possible formanagers to use more information intheir routines. Of course, the ability touse more information suddenly generateda request for more information.
Second, communication technology,together with improved transportation,also caused a much closer connectionamong geographically separate countriesand regions. The closer connection inturn increased the complexity of anyaction, because now factors influencingthe action could come from all over the
world. The final effect of these tightlinks between all the world economies isthat more information is needed to act,but one action also generates moreinformation than before.
Third, the level of sophistication of bothconsumers and strategists has increased.For consumers, this means that they wantmore for what they buy (and this “more”in most cases translates into additionalservices, i.e. information and knowledge)and they want to know more about whatthey buy. Also, the increased experienceof consumers with the products can helpthe same consumers to understand theirneeds better, and pinpoint theirpreferences to companies.
The mirror side of this phenomenon isthat more sophisticated strategies arerequired to reach consumers, which,once again, require more information toprepare and implement. Just think of themany options offered to a car buyer. Thecompetitive focus in many companieshas already shifted towards the supply ofadditional information and services inconjunction with the products.Intellectual capital has become the driverof future profits.
The conclusion is obvious: Your abilityto understand growth or decline in yourcompany’s intellectual capital — andtake early action based on this — willbecome increasingly important. To helpmanagers do this new tools have recentlybeen developed to better visualize andeven measure IC, as well as integratingIC thinking and practice into existingorganizational processes.
What is Intellectual Capital?In this article series I define IC as thesum of the “hidden” assets in anorganization. With hidden I mean thatthey do not typically show up in yourcompany’s balance sheet.
The knowledge (heads), skills (hands)and motivation (heart) of people areclearly at the core of what is meant byintellectual capital. But, there is more toit. Employees need a companyinfrastructure, “recipes” of how to dothings, conversations with colleagues tocreate value. Companies also ownintangible assets, like patents,trademarks, and brands. Although they
Managing for ExcellenceFacing the Intellectual Capital Challenge — Part I
Continued on Page 16
10 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
Among Poland’s 17 specialeconomic zones (SSEs), motorsector investors have been
especially interested in two: theKatowice zone, spread over severaldifferent cities, and the Walbrzych zone.
In the Katowice zone, 827 hectares, or24 percent of the total area, waspurchased by investors as of March 31,1998. Through the end of the firstquarter of 1998, permits granted tobusinesses for operation in the zoneguarantee investments to the tune ofabout PZ 2 billion ($590 million) and thecreation of 7,000 new jobs.
“Every day, we conduct talks with newcompanies or their representatives,”Wlodzimierz Zak, head of the servicesdepartment of SSE Katowice, told theCEAR. “Often during our first contactwith a consulting firm or bank planningto finance a given project, we don’t evenknow the name of their client seeking toinvest in the zone. This explains whypress speculation about potentialinvestors is a disturbing factor — ithardly helps finalize contracts.”
The Polish press has suggested that talkshave been held with Toyota and MandoMachinery, but neither company hasconfirmed that they are interested ininvesting in Katowice zone.
Katowice Attracts Big Names
So far, big investors in the SSE Katowicezone include General Motors, Isuzu,and Ieper Polska. GM is completingwork on a new factory for the productionof the Opel Astra. This project will endahead of schedule, with the first carsrolling off its assembly lines as early asSeptember.
In Tychy, on the other hand, Isuzu hasstarted building an engine factory that —in keeping with a stipulation in thecompany’s zone permit — should becompleted by mid-1999 to startproduction with a workforce of about400.
As early as October, production ofspecial nets for keeping shipments from
moving into the passenger cab ofvehicles will begin at the Ieper Polskaplant in Tychy for the needs of Audi andVolkswagen. This plant, financed withGerman and Belgian capital, will employ180 workers.
The Katowice zone was established inthe center of heavy industry — includingsteel and coal — and its goal is toeconomically revive the region throughthe development of other industries.
“We sometimes come across anaccusation that the local economy willagain become dominated by a singleindustry, this time by the motor industry,and in the event of poorer market trendsin the sector, some extraordinarymeasures will have to be taken again toguarantee work to people,” Zak said.
“It is true that in terms of investmentspending in the zone, companies linkedwith the car industry dominate, but interms of the number of companies, this isnot the case. Construction companies andcompanies representing food processing,furniture production, and householdappliances are all interested ininvestment in the zone.”
Zak believes that it is also necessary toremember that the car industry meansmodern technology and represents amajor driving force behind advancementin the economy.
Parts Makers Find Homes inWalbrzych
In Walbrzych, no one wants to disclosewhich new investors are applying forpermits for operation in the zone. “Thisis required by the rules of the talks,” thezone’s investment department told theCEAR.
Among already-disclosed projects,construction of a Petri factory for theproduction of plastic accessories isunderway. The factory will be launchedin late June or early July. GrossmanPolska’s facility for the production carinterior parts — in keeping with itspermit — should start production by theend of the year. And at the same time, a
BTR Automotive factory will belaunched to make rubber hoses forcooling and air-conditioning systems.
Will Zone Rules Change?
Zone officials note that investorsfrequently ask about guarantees for thestability of legal regulations — primarilytax regulations used in the zones — inthe context of Poland’s upcoming entryinto the European Union.
“We act bona fide,” said Zak. “The firstsix zones established over the pastseveral years, including our zone, have abetter legal situation than the other ones,because they do not have a clause statingthat some rules may change after Polandenters the EU,” he said. “That means therules for investors in SSE Katowicecannot change and are guaranteed byPolish law.”
The Katowice zone, considered to be themost advanced as far as investment isconcerned, has been running a databankon companies for several months now.Included in the databank are constructioncompanies, legal advisors, consultancies,parts producers, and Polish companiesseeking cooperation.
“Investors, especially foreign ones, oftenwant someone to provide services andassistance to them during the investmentprocess,” said Zak. “For this reason, wehave launched our databank, whichexclusively covers companies that wecan recommend.”
Who To Contact:
Specjalna Strefa EkonomicznaKATOWICEul. Lompy 1340-032 KatowicePiotr Wojaczek—Presidenttel. (+48-32) 51-09-58, 51-07-36fax (+48-32) 51-37-66
Specjalna Strefa EkonomicznaWALBRZYCHInvest–Park Sp. z o.o.ul. Uczniowska 2158-306 WalbrzychMiroslaw Greber—Presidenttel. (+48-74) 41-35-00, 41-35-63fax (+48-74) 41-01-77
Magda Sowinska (Warsaw)
Automotive Companies Flock to Poland’sSpecial Economic Zones
© Central European Trade & Marketing, L.L.C. 1998 http://www.cear.com ™ CENTRAL EUROPE AUTOMOTIVE REPORT™ • June 1998 11
This month’s column focuses on whatautomotive manufacturers expect of theirsuppliers in today’s global automotiveindustry.
The essence of the customer require-ments are embodied within the QS-9000“Quality System Requirements” Stan-dard. But beware. The expectations willnot be satisfied if the supplier simplyachieves 3rd party registration through thediligence of its Management Representa-tive for Quality and the company’straditional quality department.
Traditional quality departments havetheir roots in inspection related functions(i.e. check after the event). The expecta-tions of the new global automotiveindustry demand that the supplier befocused on the prevention of concernsand problems. This requires the TotalQuality approach of all management asexplained in last month’s column.
To achieve the expectations discussedbelow, it is essential to prepare theground for the seeds to mature, blossom,and have sustainable growth. Preparingthe grounds means creating the rightmanagement and company-wide attitudeto create and develop competencies thatwill allow the seeds to grow — i.e. theeffective and sustained use of appropriatesystems, tools, and techniques. Trainingin the techniques is simply not enough.Competencies must be developed, asmust an environment of support,mentoring, and leadership.
QS-9000 Quality SystemRequirements
QS-9000 Quality System Requirementsthat are often met “in principle” butwhich demand in-depth knowledge tomeet customer expectations include thefollowing:
Quality Planning
If there is a responsibility for ProductDesign, then this process of planningstarts with the “Voice of the Customer”,i.e. Quality Function Deployment (QFD)
and Experimentation to ensure therobustness of design.
Feasibility reviews to investigate andconfirm manufacturing feasibility ofproposed products then follow, prior tocontracting to produce those productstogether with process design andexperimentation for process robustness.
Potential Failure Mode and EffectsAnalysis for both product and process isrequired, as is action to eliminatepotential concerns or the identification ofparameters which need to be controlledand documented in a Control Plan, whichcovers all aspects from prototype,through pre-launch, and duringproduction.
Cross function teams are demanded forthese activities, which cover not onlydifferent departments in a company, butcould also involve personnel external tothe company.
Design Skills
QS-9000 states, “The supplier’s designactivity should be qualified in thefollowing skills, as appropriate:
• Geometric Dimensioning andTolerance (GD&T)
• Quality Function Deployment(GFD)
• Design Manufacturing (DFM)/Design for Assembly (DFA)
• Value Engineering (VE)• Design of Experiments (DOE;
Taguchi and Classical)• Failure Mode and Effects Analysis
(DFMEA/PFMEA)• Finite Element Analysis (FEA)• Solid Modeling• Simulation Techniques• Computer Aided Design (CAD/
Computer Aided Engineering (CAE)• Reliability Engineering Plans”
It should be noted that “qualified” meanscompetent, not only trained.
Evaluation of Sub-Contractors; Sub-Contractor Development
QS-9000 states, “Suppliers shall performsub-contractor quality systemdevelopment, using Sections I and II ofQS-9000 as the fundamental qualitysystem requirement.”
This is obviously a very demandingrequirement when suppliers are in themidst of applying the stringent QS-9000(and other customer expectations) withintheir own organization.
Preliminary Process CapabilityRequirements; On-going ProcessPerformance Requirements
For customer-designated specialcharacteristics for new processes, thecapability indices shall meet customerrequirements.
For unspecified requirements, thepreliminary process capability (Ppkvalue), should be > 1.67.
For on-going processes, processcapability requirements (Cpk value)should be > 1.33.
Regardless of the capability requirementor the demonstrated process capability,continuous improvement is required,with the highest priority on specialcharacteristics.
Many automotive customers are nowdemanding the achievement of publishedprocess capability goals against time, andendeavoring to support these demands byproviding training for suppliers toachieve competency in processimprovement. The expectation is clearlythat suppliers must develop suchimprovement action plans.
Quality Expectations of the Global Automotive IndustryBuilding Supplier Quality: Lesson 3With Ray Barker, Group Director,Business Excellence Strategy, Avon Rubber
New Feature
Quality in Action
Skoda Auto’s SupplierDevelopment Task Force andSkoda’s active involvement inpartnering local suppliers withWestern companies has enabled itto source nearly 75% by value of itspurchasing volume from 279 Czechand Slovak suppliers.
Continued on Page 16
12 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
slowdown seen this year make it verydifficult for finance companies to predictthe level of demand for vehiclefinancing.
CEAR: Is loan defaulting a majorproblem in Poland?Neitzsch: So far, we have notexperienced any bad debt yet, but we
have only just started. Generally inPoland, debt defaulting is very good withprivate customers — only around 1% ofall loans is defaulted, which is very low.The attitude here is positive towardsrepayment.
Customers seem to regard it as anobligation to repay debt. Perhaps this isbecause consumer financing of this sortis very new and customers feel theyshould meet their obligations. This isdifferent from the rest of Western Europewhere people are very used to credit andthere often seems to be a far morerelaxed attitude about repaymentdefaulting.
CEAR: How difficult is creditchecking in Poland?Neitzsch:. It is very different [compared]to Western Europe. There is no companysuch as HPI-Equifax doing this. Peopleand companies here do not have anycredit history and obviously this makes ita much longer process to assess acustomer’s credit worthiness.
A credit checking system is underdevelopment by the Polish bankingassociation and according to them, it willbe running within the next twelvemonths. But it will be several, maybefive years before it is active and virtuallyall customers are in the database.
I saw how long it took in East Germanywhen I worked at Ford Bank in Leipzigin the early 1990’s. It took over three
head of Ford Credit Poland SA.
CEAR: How are Ford’s financialservices activities organized inPoland?Neitzsch: Ford has two financial serviceoperations in Poland. The first one setup, Ford Credit Poland SA, started in1995 and offers operational leasing forcommercial vehicles. My organization,Ford Bank Polska, provides retailfinance for both private customers andcommercial organizations. Thesecompanies are run in Poland as twoseparate operational and legal entities.
CEAR: How is the sales andmarketing function organized?Neitzsch: All the sales and marketing isdirected through the Ford dealernetwork. The dealer acts as an agent forboth Ford Bank and Ford Credit. Thereare currently 50 Ford dealers acrossPoland and these are the exclusive agentsfor Ford’s financial services. With thedealer network, we have near saturationcoverage of the country.
CEAR: How important is financingfor vehicle purchases in Poland?Neitzsch: Very important. Exactnumbers are difficult to get, though. In1997, it’s estimated that 60% of all newvehicle sales had some form of financinginvolved, either a loan or a lease. Thishas grown from an estimated 35% in1995. This is much higher than inWestern Europe.
But it is expected that the levels offinancing seen in this country will moveto be more in line with those seen inWestern Europe, where the norm isaround 30-40%. I have no doubt thatover the next five years this will happen,as it has with most aspects of commerciallife.
We inevitably are very dependent on newcar sales. The high growth rate in newvehicle sales seems to have slowed downa lot this year, largely due to the newimport quota regulations. New car saleswill probably grow again in 1998, butdefinitely not at the levels seen in 1996and 1997. The recent growth rates seenover the past few years and the
years for the credit checking system tobuild up the database of customers. So itwill take some time.
CEAR: So how is credit checkingdone now?Neitzsch: It takes longer than it does inthe rest of Europe and is less precise.Mainly, credit companies have to rely onincome statements signed by employers.Inevitably, this is far more laborintensive than in Western Europe, whereit can be done over the telephone or viaan on-line search.
CEAR: What are the specificadvantages that Ford Bank Polska canoffer its customers?Dr Neitzsch: We work with the dealersand through them we can offer “one-stopshopping”. Prior to our arrival,customers had to shop around forfinance. Now, the dealer can supplymuch better levels of service byproviding financing as well. Again, thisis becoming the same as in WesternEurope, where we offer the best levels ofservice and quality to our customers.
CEAR: Who are your majorcompetitors?Neitzsch: The main competition comesfrom the Polish deposit banks whocompete on price, but not necessarily onservice. The Polish banks varyenormously in the levels of service thatthey provide.
We aim to be competitive on price, butwe are not necessarily the cheapest. Wedo have much faster response rates thanthese banks. We also have standardizedlevels of service across our dealernetworks that they cannot match.
Opel has also started its own bank toprovide financing through its dealernetwork. In addition to the majorcompanies with their captive leasingcompanies, other providers of financinginclude numerous small and financiallyweak companies.
CEAR: Where do you see Ford Bankin 5 years time?Neitzsch: I see Ford Bank as havingexactly the same range of financialproducts and levels of service asprovided by Ford throughout the rest of
“In 1997, it’s estimated that60% of all new vehicle saleshad some form of financinginvolved. This has grownfrom about 35% in 1995.”
Profile Continued from Page 1
© Central European Trade & Marketing, L.L.C. 1998 http://www.cear.com ™ CENTRAL EUROPE AUTOMOTIVE REPORT™ • June 1998 13
Western Europe. I also envisage on-linecredit checking and connections betweenall the dealers and Ford Bank, which willgreatly speed up the service levels wecan provide to customers.
CEAR: What isyour expectedmarket share?Neitzsch: Again, Ienvisage that themarket share weobtain in Poland willbe comparable to thatwhich is achievedthroughout Western Europe and we willbe providing financing for 30-40% of allvehicles sold by Ford.
We now have the necessaryinfrastructure, systems, and key people inplace for the business to develop. Thereare now 40 employees and we willprobably have 50 in two years time; itwill obviously depend on the level ofbusiness.
CEAR: Many companies have foundit difficult to recruit suitably qualifiedstaff in Poland. Have you had similarexperiences?Neitzsch: We are very satisfied with thededication and abilities of the staff that
we have employed. They show a lot ofcommitment. Admittedly, many of ourstaff had limited experience when theyjoined us, but they are highly motivatedto learn, especially in the new marketsthat we are developing.
CEAR: How do you find staff? Thiscan be a difficult and time consumingprocess in Poland?Neitzsch: We mainly use newspaperadvertisements. When we started, weused head-hunters, but for the level ofstaff we are now recruiting, advertisingworks fine. Ford has a very good nameand we can attract quality candidateswho want to work for us. We have strictselection criteria.
CEAR: How important is training toFord Bank?Neitzsch: Essential. The key to ourbusiness is a willing and able staff. Theworkload in processing applications for
financing in Poland is far higher than inthe rest of Europe. We depend on staffwho are motivated and trained. Wespend a lot of time and money ontraining staff in this country and at FordCredit training centers internationally.Ford personnel also receive a lot of onthe job training.
CEAR: What is the most difficultaspect of your job in Poland.Neitzsch: I find my role here veryinteresting and challenging. The situationin Poland is quite different from that inWestern Europe. In Poland, we have tobe registered as a bank, complying withthe regulations laid down under Polishbanking laws. Whereas in the rest ofEurope, it is not always necessary to beregistered as a bank to provide the rangeof services that we offer. Complyingwith Polish banking laws creates a lotmore administrative requirements for usto adhere to.
CEAR: What will be the key to FordBank’s success in the future?Neitzsch: Without a doubt, the key willbe to ensure service and quality. Thiswill be [achieved with a] well trainedstaff. We also aim to have more efficientsystems that ensure the best levels ofservice for customersn
“Generally in Poland, debt defaulting isvery good with private customers — onlyaround 1% of all loans are defaulted.Customers seem to regard it as anobligation to repay debt.”
• Kracow• Mazovia• Mielec• Katowice• Suwalki• Legnica• Walbrzych• Lodz• Zarnowiec• Tczew (Gdansk province)• Kamienna Gora (Jelenia Gora province)• Kostrzyn-Slubice (Gorzow province)• Starachowice (Kielce province)• Slupsk• Tarnobrzeg• Olsztyn• Czestochowa
Poland’s Special Economic Zones
Visit the Expert Directories at http://www.cear.com or click here CEAR.COM ™
Country 1998 1997 % Change1 Germany** 971,900 869,320 11.82 Italy** 716,500 617,672 16.03 U.K. 622,600 550,486 13.14 France 460,200 406,897 13.15 Spain** 272,000 239,016 13.86 Netherlands** 167,800 159,052 5.57 Poland* 137,525 130,635 5.38 Belgium 136,500 122,862 11.19 Austria** 80,000 75,472 6.010 Switzerland** 69,100 68,688 0.611 Portugal** 58,800 55,577 5.812 Sweden 58,300 51,411 13.413 Ireland** 56,400 51,180 10.214 Greece** 44,900 41,005 9.515 Denmark** 40,400 39,300 2.816 Finland 34,200 30,292 12.917 Norway 27,000 29,703 -9.118 Luxembourg 9,900 9,602 3.1*Grey import not included** Provisional figures Source: SAMAR, s.c.
New Car Registrations Growth in Europe (YTD March)
14 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
RRRRRussia & CISussia & CISussia & CISussia & CISussia & CISWWWWWatcatcatcatcatchhhhh
The U.S. Department of Energy’s(“DOE”) Initiatives forProliferation Prevention (“IPP”)
program is a unique opportunity for USautomotive companies seeking to takeadvantage of the abundant raw materialsand under-employed skilled labor pool inthe former Soviet Union.
The IPP funds projects at the 10 largestDOE National Laboratories, which inturn subcontract with institutes in Russia,Belarus, Kazakhstan, and Ukraine thatformerly had connections with nuclear,chemical, or biological defense work.The emphasis is on commercialization oftechnology from these institutes.
The IPP helps to compensate fordramatic drops in budgets at theseinstitutes and the lack of meaningfulalternate employment, which represent asignificant proliferation concern for theworld.
Two Stage Procedure
The first project stage is a technicalfeasibility stage. If the project producesthe desired results, then there is a secondstage which involves a US industrypartner in a three way relationship. Toparticipate, however, the company mustput up its own money. It must match, interms of work in its own R&Destablishment, the dollar amount that theDOE puts into the DOE nationallaboratory (half of which in turn goes tothe foreign institute under a subcontract).
Current Projects
The IPP program has spawned severalprojects that have automotiveapplications. In one first stage project,Los Alamos scientists and engineers willwork with the Institute for ElectroPhysics to investigate the use of intenseion beams to produce surface coatingsfor manufactured goods, a process thatdramatically hardens metal surfaces toreduce wear.
General Motors, DuPont, and ISMCorporation have all expressed interestin future cooperation on this project.
The project, however, is still in thetechnology feasibility stage.
Two other automotive related IPPprojects have reached the second stage ofdevelopment. They both involve theLawrence Livermore NationalLaboratory and the Russian center atSnezhinsk (Chelyabinsk-70). Theprojects involve the development ofsuperplastic roll forming technology forthe production of automotivecomponents using various metal alloys.
IPP Funds Electric Vehicle BatteryProduction in Siberia
Energy Conversion Devices, Inc.(“ECD”) is involved in an IPP fundedproject to further develop ECD’sproprietary clean energy technologies forthe Russian market. The projectprovides a good example of how anautomotive company can tangibly benefitfrom the IPP program.
Proposals for the project were made bySovlux, ECD’s Russian-American jointventure with Scientific and IndustrialEnterprise KVANT and the RussianMinistry of Atomic Energy . SovluxBattery, a branch of Sovlux, is 50%owned by ECD and 50% by theChepetsky Mechanical Plant in Glazov,Siberia. Sovlux Battery will produceNiMH battery materials and batteries forthe emerging two- and three- wheeledelectric vehicle market in Europe andAsia.
“This comes at a very important time inthe development of our battery businessin the emerging electric vehicle market,”said Stanford R. Ovshinsky, Presidentand CEO of ECD. “Sovlux Battery willhelp us provide [NiMH] batteries at areduced cost.”
How was the project set up?
DOE National Laboratories involved inthe project received funding in order toenter into cooperative R&D Agreementswith ECD, which matched, dollar-for-dollar, the DOE funding. Of the DOEfunding to the labs, at least half went to
Russian institutes or other entities tofund technical work under a subcontractmechanism.
Under this mechanism, payment is madeonly when agreed-upon deliverables arereceived by the DOE NationalLaboratory from the foreign institute.Part of the role of the DOE NationalLaboratory is to evaluate the deliverablesand see if they meet the contractualstandard. Deliverables can be hardware,data, reports, software, or other productsof scientific or engineering work.
According to ECD, the IPP funding willbe used to:
• employ scientists and engineersformerly engaged in theproduction of metal alloys fornuclear weapons in theproduction of metal alloys andcomponents for nickel metalhydride (NiMH) batteries
• employ scientists formerlyengaged in the design andproduction of nuclear weaponschambers in the design andproduction of manufacturingequipment for photovoltaicroofing materials to beproduced by Sovlux
• employ scientists formerlyengaged in uranium enrichmentto recycle imported gases usedin production of photovoltaiccells produced by Sovlux
For more information about how yourcompany can get involved in the IPPprogram, please contact:
William J. DesmondProgram Director, IPPOffice of Arms Control andNonproliferationUS Department of Energytel: 202-586-6439fax: 202-586-2164e-mail: [email protected]
IPP Program Funds Russian R&D ProjectsBattery-Maker Secures Funding For Russian JV
© Central European Trade & Marketing, L.L.C. 1998 http://www.cear.com ™ CENTRAL EUROPE AUTOMOTIVE REPORT™ • June 1998 15
Due to the rapid development of Poland,and the Silesian region in particular,many international companies havedecided to do business in this market. Inorder to attract investors, the Polishgovernment issued a special regulationthat allows the Minister of Finance toestablish Special Economic Zones(SSEs). One such zone was created in1996 in the Katowice region. Thecreation of this zone caused a massiveamount of automotive relatedinvestment to flow into the south ofPoland, especially after the news thatGeneral Motors had decided to builda new factory in Gliwice.
Special Economic Zones
Entities investing in SSEs may begranted very attractive tax allowancessuch as:
• full exemption of income tax for halfof the period for which the zone isestablished (in most cases 10 years);
• exemption of 50% of income fromtaxation during the remaining yearsof the zone’s existence (in most
cases another 10-year period); and• possibility to increase the rate of
depreciation.
In order to be granted special taxallowances, companies must satisfycertain conditions. The most importantand also the most often misunderstood
condition is “a local content”requirement. The law states that at least30% of the sales price of goods producedin the zones (i.e. materials and servicesused to manufacture goods in SSEs)must be connected with services andgoods produced and rendered in thezones.
Many automotive companies whodecided to invest in SSEs establishedassembling units that do not use goodsproduced locally to manufacture the finalproduct. As a result, they are not able tosatisfy “the local content” condition.The only locally incurred costs areusually the labor force and depreciationwhich together often do not constitute30% of the sales price. Thus, it is veryimportant for companies to determine inadvance whether they will be able tosatisfy all conditions, especially the localcontent requirement.
It should also be noted that companiesmay lose the right to tax allowances ifduring the performance of economicactivities in SSEs they have unpaid taxliabilities exceeding a certain level.Considering that the VAT system inPoland is still very complicated,automotive companies must be verydiligent with their VAT settlements. Iftax allowance rights are lost because ofunpaid tax liabilities, the company mustreverse the effect of the incentives andadd to their income the amount of theincome previously exempt from tax.
As the Polish legal system and taxregulations are still prone to frequentchanges, it is of utmost importance tostay on top of all regulations in order toprevent any loss of tax incentives orexemptionsn
“The law states that at least30% of the sales price ofgoods produced in thezones must be connectedwith services and goodsproduced and rendered inthe zones.”
Tax Advantages Behind Poland’s SpecialEconomic ZonesKatarzyna Sawicka-Hughes & Anna Strzelecka,Tax Advisors, Arthur Andersen Warsaw & Katowice offices
Brand YTD April ‘97 Market Share YTD April ‘98 Market Share Units Change Share ChangeRENAULT 4,943 20.66% 4,387 18.83% -11.25% -8.87%VOLKSWAGEN 2,961 12.38% 2,887 12.39% -2.50% 0.12%DAEWOO 841 3.51% 2,032 8.72% 141.62% 148.10%FIAT 2,280 9.53% 1,915 8.22% -16.01% -13.76%CITROEN 1,192 4.98% 1,743 7.48% 46.22% 50.15%OPEL 1,254 5.24% 1,354 5.81% 7.97% 10.87%SKODA 1,630 6.81% 1,174 5.04% -27.98% -26.04%HYUNDAI 1,629 6.81% 1,018 4.37% -37.51% -35.83%FORD 1,307 5.46% 968 4.15% -25.94% -23.95%KIA 343 1.43% 821 3.52% 139.36% 145.78%SEAT 810 3.39% 768 3.30% -5.19% -2.64%AUDI 557 2.33% 686 2.94% 23.16% 26.46%PEUGEOT 673 2.81% 593 2.54% -11.89% -9.52%HONDA 469 1.96% 476 2.04% 1.49% 4.21%ROVER 455 1.90% 393 1.69% -13.63% -11.31%MITSUBISHI 109 0.46% 272 1.17% 149.54% 156.23%ALFA ROMEO 154 0.64% 246 1.06% 59.74% 64.02%SUZUKI 561 2.34% 243 1.04% -56.68% -55.52%LADA 362 1.51% 186 0.80% -48.62% -47.24%BMW 189 0.79% 179 0.77% -5.29% -2.75%VOLVO 126 0.53% 109 0.47% -13.49% -11.17%OTHER 1,082 4.52% 852 3.66% -21.26% -19.14%TOTAL 23,927 100.00% 23,302 100.00% -2.61%
New Car Registrations in Slovenia by Brand SOURCE: REVOZ
16 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
do not exist physically, these assets areincreasingly very important to thecompany. Just think of the value of carbrands or the extreme case of thetremendous value of the Coca-Colabrand. Finally, IC also includes the valuecreated by customers (and supplier’s)loyalty.
These basic categories, and the flowbetween them, make up the IC ofcompanies. This is why IC is a muchbetter predictor of future profits thanmost other measures used in companiestoday. Thus, IC offers clear guidelinesfor what is good management practice.
The Management Challenge
Having become lean manufacturers,reduced your costs by setting up inCentral Europe, and moving towards azero defect environment, the nextchallenge lies in IC. The concepts behindIC are helping managers view strategicand operational issues in a new way andare spreading quickly across industriesand countries.
The management challenge from thisperspective is to nurture, and leveragegrowth in your company’s intellectualcapital, and pick up on early warningsigns of declining IC. This is how youcan get a better grip on what will driveprofits tomorrow. But first you need todevelop a tool to visualize IC and thatwill be the topic of next month’s article.
Next Month: Developing Tools forMeasuring Intellectual Capital
Excellence Continued from Page 9
Measurement System Analysis (MSA)
Evidence is required that appropriatestatistical studies have been conducted toanalyze the variation in the results ofeach type of measuring and test system,utilizing gauge repeatability andreproducibility studies (R&R studies).
It is expected that process capabilityvariation resulting from standarddeviations in measurement capabilitywill be controlled within a very tightlimit. This is an often forgotten sourceof variation.
Corrective and Preventive Action —Problem Solving Methods
Disciplined problem solving methods forcorrective and preventive actions shallbe used when an internal or externalnon-conformance specification orrequirement occurs.
For problem solving using a teamapproach, it is essential to ensure thatpositive team dynamics are developed tocreate and benefit from the synergyarriving from team membership skills.This and the teaching/understanding andapplication of a disciplined problemsolving methodology generally requiresspecialist support for success.
Next Month: Quality Expectations in theGlobal Automotive Industry Part II
Central European Purchasing Executives
COMPANY NAME/TITLE CONTACTDaewoo Motor Polska Yeon-Seob Jeong, Purchasing Director Tel: 48-81-749-3301; Fax: 48-81-749-3309Fiat Auto Poland Giovanni Patelli, Purchasing Manager Tel: 48-33-132-542; Fax: 48-33-126-988Ford (Czech Republic) Stefan Tyrpak, Purchasing Manager Tel: 420-2-2481-1727; Fax: 420-2-2481-2488Ford Hungaria Zsolt Marton, Purchasing Manager Tel: 36-1-250-9865; Fax: 36-1-250-9866GM Poland Achim Kuehne, Purchasing Director Tel: 48-22-676-3100; Fax: 48-22-676-2803Isuzu Motors Polska Ichiro Murai, Gen. Manager Purchasing Tel: 48-32-217-7307; Fax: 48-32-217-7308Magyar Suzuki Mrs. Eva Klujber, Purchasing Director Tel: 36-33-414-311; Fax: 36-33-412-014Opel Czech & Slovak Josef Dolezal, Purchasing Manager Tel: 420-2-2438-400; Fax: 420-2-6121-1259Renault/Revoz (Slovenia) Pierre Couillerot, Director of Purchasing Tel: 386-61-1723-301; Fax: 386-61-1723-320Skoda Auto a.s. Guenter Becker, Head of Purchasing Tel: 420-32-681-1153; Fax: 420-32-681-1173VW (Czech Republic) Hana Cejnarova Tel: 420-32-681-1002; Fax: 420-32-681-1179
Quality Continued from Page 111997 Skoda QualityAward Winners
COMPANY
Delphi Packard Electric, Ceska Lipa(1)
SAS Autosystemtechnik, MladaBoleslav (1)
Blaimer International, Bela podBezdezem (1)
Perovna Hostivar, Prague (1)
ITT Automotive CZ, Kolomuty (1)
Pronovia, Velka Bites (1)
TOS Kurim, Kurim (1)
ZVL Tribometal, Kolny Kubin (2)
VDO Instruments, Prague (2)
Temac, Zverinek (2)
Metals, Nejdek (2)
Avon-Rubena, Rudnik (2)
AKUMA, Mlada Boleslav (4)
Sluzba VDI, Nitra (4)
PEKM Knobloch, Liberec (5)
( ) indicates the number of years thecompany has won the award
Classifieds &Investment Opportunities
CENTRALEUROPEAUTOMOTIVEREPORT™
Manufacturer of drivingshafts, steering shafts,steering gears, and spareparts seeks foreign investorWieslaw KosieradzkiPIASTtel: 48-22-827-8700fax: 48-22-826-7341Poland
Manufacturer of centrifugaloil separators, heaters, waterand oil coolers for cars &trucks, water pumps forvans, trucks, and ships seeksforeign investorWieslaw KosieradzkiPIASTtel: 48-22-827-8700fax: 48-22-826-7341Poland
Manufacturer of fuel supplysystems for car & vanengines, compressors forpneumatic braking systemsfor cars, buses, & farmtractors, compressor units &pneumatic fittings, & spareparts for compressors seeksforeign investorWieslaw KosieradzkiPIASTtel: 48-22-827-8700
fax: 48-22-826-7341Poland
Manufacturer of hydrauliccylinders, up to 32 barspressure, 25-160 pistondiameter, up to 4,000 mmlength, seeks SlovakRepublic commercialcooperation, offersproduction to orderJorgen VarkondaSNAZIRre:Rerosa s.r.o.tel: 421-7-5335-175fax: 421-7-5335-022Slovak Republic
Manufacturer of exhaustflanges, light welded steelconstructions, agriculturalmachines, and hydrauliccomponents under SauerCo. license seeks jointventure partnerJorgen VarkondaSNAZIRre: Topolcianske Strojarnetel: 421-7-5335-175fax: 421-7-5335-022Slovak Republic
Manufacturer of car & truckair and oil filters seeks joint
venture partner forproduction, financial, anddistribution cooperation.Monthly air filter capacityfor cars of 60,000, and6,000 for trucksJorgen VarkondaSNAZIRre: Sandrik a.s.tel: 421-7-5335-175fax: 421-7-5335-022Slovak Republic
Manufacturer of pressedparts for cars, press units,electric carriages, andmachine tools seekscommercial or productioncooperationJorgen VarkondaSNAZIRre: BAZ a.s.tel: 421-7-5335-175fax: 421-7-5335-022Slovak Republic
U.S. partner sought forCzech producer ofcrankshafts (various sizesup to 2500 mm lengths) forpurpose of contractmanufacturing. Company issupplier to producers ofengines for trucks, tractors,
ships, & stationaryaggregates. 1996 turnoverexpected to be $20 million.Jan Vesely IESCtel: 420-2-2499-3170fax: 420-2-2499-3176Czech Republic
Partner sought for producerof diesel injectionequipment for development,production, & sale of singleand multi-cylinder in-lineinjection pumps for all typesof diesel engines, as well asfor injection systems,testing, measuring, &adjustment equipment.1995 turnover was $40million.Jan Vesely IESCtel: 420-2-2499-3170fax: 420-2-2499-3176Czech Republic
Manufacturer of plasticparts for Opel, Mercedes,VW, & Suzuki seeks equitypartner who is engaged inplastic processing business$5 millionCsaba Kilian, ITDHre: Pemutel: 36-1-118-0051fax: 36-1-118-3732Hungary
Supplier of seats for Suzukicars & Spare parts forIkarus seeks purchaser.Company undergoingprivatization process.Csaba Kilian, ITDHre: 02/Aut/96tel: 36-1-118-0051fax: 36-1-118-3732
Hungary
Battery manufacturer seeksjoint venture partner forprocessing used vehiclestarter batteries$2.1 millionCsaba Kilian, ITDHre: Periontel: 36-1-118-0051fax: 36-1-118-3732Hungary
Russian bus company seeksAmerican joint venturepartner to manufacture newbus models. Business planavailable in EnglishVictor SergeyevichKostrominGeneral DirectorPavlovo Bus Co.tel: 7-83171-6-81-14fax: 7-83171-6-03-18Russia
Russian company seeks ajoint venture partner to re-build car and truck tires andrecycle tires and otherrubber products into pellets.Alexander NikolayevichKalinGeneral DirectorKstovo Tire Repair &Recyling PlantTel: 7-8312-38-12-75Fax: 7-8312-38-12-75
Sell Your Product, Service, orOpportunity with a CEAR™
50 Word Classified for USD$100.Including an Internet Listing
at http://www.cear.comFax or Email Your Classified.
Include your name, phone, and fax.Tel: +1-440-843-9658 Fax: +1-206-374-5282
Email: [email protected]
Make sure the auto industry hears about your company’s activities inCentral Europe. Send the CEAR™ your news about:
• recent and projected sales and production figures• new joint ventures or cooperation agreements• facility expansion plans (e.g. new equipment, new buildings)• business expansion plans (e.g. new markets, new products, new supply contracts)• personnel changes, recent awards, licenses, certifications• new product news• upcoming company events (e.g. supplier conferences)
Fax, email, or mail press releases to the CEAR™:Email: [email protected]: +1-206-374-5282Toll Free inside US Fax: (800) 684-3393Slovak Republic Fax: +421-7-361-085Post: 4800 Baseline Rd. Suite E104-340, Boulder, CO 80303 USA
Get the Word Out, Send Us Your News!Make Sure Your PR & Marketing People See This
18 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
Back in March, Daewoo Avia introducedthe new light commercial vehicle Lublin3.5. The Lublin 3.5 will be assembled atDaewoo Avia’s factory in the CzechRepublic from kits delivered by DaewooMotor Poland in Lublin, Poland.
The assembled Lublin 3.5 will be sold inthe Czech Republic through DaewooAvia’s sales network. More than 1,100Lublin trucks of various modificationhave been sold in the Czech market sinceearly 1997 when Daewoo Avia startedassembling the trucks.
Czech Government To OfferUnprecedented Investment Incentives
In late April 1998, the Czechgovernment approved the country’s firstformal package of national investmentincentives since the fall of communismin 1989. All new manufacturinginvestments in the Czech Republic ofover $25 million will be eligible forbenefits under the 6-point package.
The package covers corporate taxationdeferrals and bonuses, customs dutywaivers and beneficial VATarrangements on imported equipment,the provision of low-cost developmentland, job training grants, special jobcreation benefits for firms locating inunder-developed regions, and specialcustoms zones for major investors.
Hungary
Suzuki Willing To Expand In Hungary— Wants Help From Government
Suzuki may invest another $75 million ormore into its Hungarian car plant —Magyar Suzuki — if the Hungariangovernment provides more support,Osamu Suzuki, president of SuzukiMotors Corp., said at a recent pressconference. Mr. Suzuki indicated thatthe capacity of the plant might beincreased to 100,000 units. Currentproduction capacity is 70,000 units.
Magyar Suzuki’s revenues in 1997totaled 77 billion forints ($366 million),up 36% compared to 1996. Net incomerose to 1.65 billion forints ($7.8 million),an 86% increase over 1996’s results.
end modules and air conditioningsystems from a joint production plant inthe Czech Republic. Hella brings to theventure its car lighting systems andelectronics manufacturing expertise,while Behr contributes its skill as aproducer of air conditioning and enginecooling systems.
Skoda Auto Awards its Best Suppliers
In April, Skoda Auto presented its 15best suppliers with the 1997 SkodaQuality Award. Skoda purchased CK54.8 billion ($1.6 billion) worth ofsupplies in 1997, with almost 70% of thisamount coming from Czech basedsuppliers. Czech suppliers deliveredsupplies to other VW group companiesvalued at CK 7.6 billion ($223 million).
“VW and Skoda Auto support thosesuppliers who are capable of taking overthe results of our parts and productsengineering quickly, in prime quality andin an innovative manner,” said FranciscoGarcia Sanz, member of the VW brandboard responsible for purchasing. (seechart of award winners on page 16)
Daewoo Avia’s First Quarter Results— Car & Truck Sales Drop
During the first quarter of 1998, DaewooAvia sold 661 Avia trucks, down about30% from the 939 units sold during thesame period in 1997. First quarter salesof Daewoo Lublin trucks totaled 132,down slightly from 137 units a year ago.
Daewoo Avia’s first quarter sales ofDaewoo cars in the Czech Republicdecreased by over 43% compared to thesame period last year. First quarter 1998sales totaled 669 units, compared to1,181 units sold during the same periodlast year.
The big drop was primarily due to theend of Tico sales in the Czech Republic.In mid 1997, sales of the popular Ticowere stopped due to strict emissionregulations in the Czech Republic. TheTico will be replaced by the new Matiz,launched in Korea in late March. Salesof the Matiz in the Czech Republic willbegin in the second half of 1998.
New Light Commercial Vehicle
GM Opening New TransmissionOperation In Hungary; OpelAssembly Phased Out
General Motors Corp. plans to increaseits investment in Hungary by pumpinganother $128 million into a transmissionplant in Szentgotthard in WesternHungary. The new plant will have anannual capacity of 250,000 units and isexpected to employ 500 people.Operations are slated to begin in the year2001.
According to company officials, by theend of this year GM will discontinue itsOpel Astra assembly operation inSzentgotthard to free up resources for thenew project. Officials have alsoindicated that a new engine facility is notlikely to be built in Hungary, but insteadwill probably go to Germany.
GM currently assembles the Opel Astraand produces engines and cylinder headsin Szentgotthard. The new investmentbrings GM’s total investment in Hungaryto over $500 million.
New Car Sales in Hungary Up 50%During First Quarter
New car sales in Hungary jumped over50% during the first quarter of 1998.First quarter sales totaled 21,688 units,compared to 14,374 units sold during thefirst quarter of 1997. Reasons cited forthe big increase are an improvingHungarian economy, the availability ofbetter car financing programs, andunattractive bank savings rates.
Local manufacturer Magyar Suzuki sawits sales rise over 50% to 4,704 vehicles,compared to sales of 3,122 units duringthe same period last year. Thecompany’s market share held steady atalmost 22%. Opel’s sales also rosesharply to 3,362 units, compared to2,165 units sold in Q1 1997. Opel’smarket share rose slightly from 15.06%to 15.50%.
Ford took over the third position fromVolkswagen with sales of 1,953 unitsand a market share of 9%.Volkswagen’s sales totaled 1,820 units,giving it a market share of 8.4%. At thistime last year VW’s market share wasalmost 13%.
Highlights Continued from Page 4
© Central European Trade & Marketing, L.L.C. 1998 http://www.cear.com ™ CENTRAL EUROPE AUTOMOTIVE REPORT™ • June 1998 19
1998 CEAR™ Central European Automotive Excellence Award
The CENTRAL EUROPE AUTOMOTIVE REPORT is accepting nominations for the 1998 CEAR™ Central EuropeanAutomotive Excellence Award. This award will be presented to the Central European automotive manufacturer or supplier thathas best demonstrated market leadership through its use of innovative manufacturing and marketing systems. The award isgiven to recognize the positive influence such exemplary leadership has on the development of the Central Europeanautomotive sector. We would greatly appreciate your input in nominating candidates for this award. You may nominate yourown company or others. The deadline for nominations is August 15, 1998.
Nominee Reasons
Fax to: +1-206-374-5282 Email to: [email protected]
Fiat’s sales rose over 140%, from 668units during Q1 1997 to 1,608 units inQ1 1998. The company saw its marketshare jump from 4.6% to 7.4%.Daewoo’s sales were slightly off at 1,338units. The Korean carmaker’s marketshare slid from 9.6% to 6.4%.
Slovak Republic
VW/Siemens JV To Boost WireHarness Production
Volkswagen Elektricke Systemy isboosting its wire harness production tokeep up with increased demand for VWGroup models. The company, a jointventure between Volkswagen AG andSiemens AG, is moving from two shiftto three shift production, and by the endof May expects to increase the number ofits employees from 1,330 to 1,500-1,600.
VW Elektricke’s current production areain Nitra, Slovakia is 40,000 sq. meters,of which production halls cover 14,510sq. meters. Soon, this will be notenough, reported the company’s
economic director Hermann Krueder.
VW Elektricke’s customers include VWBratislava, Audi Hungary , and SkodaAuto in the Czech Republic. In May1998, the company plans to startsupplying harnesses just-in-time to VWBratislava. The harnesses will beinstalled by VW Elektricke employeesworking directly on the VW Bratislavaassembly line.
VW Elektricke’s turnover in 1998 shouldreach DM 80 million ($44 million). Netprofit in 1997 was DM 800,000($444,444) and turnover reached DM28.9 million ($16 million). The capitalstock of the company is just over DM 4million.
The average monthly salary of thecompany’s workers in Slovakia is SK10,500 ($300), which does not includesalaries paid to the German topmanagement.VW Elektricke is a daughter company ofVW Bordnetze AG, Berlin, Germany.Established in January of 1996, the first
harnesses were produced by the jointventure in June 1996.
Slovenia
Revoz/Renault Replacing ClioProduction with Clio II
Slovenia’s only car producer, Revozd.d.’s (54% owned by Renault S.A.,France) production plan for 1998 is formore than 90,000 cars, with the Cliobeing gradually replaced by the Clio II.In late 1998, the Clio II will be the solemodel produced in Slovenia.
Installed capacity at the Slovenianfactory is 100,000 units, using two shiftsand a five day working week. Last year,the company achieved a recordproduction of 95,951 Renault Cliomodels. Exports totaling 89,404 carswere made mostly to Italy, Germany,France, and Austria. As of December31, 1997, Revoz had 2,560 employeesn
Supplier Products Key CustomersUT Automotive, Hungary Wiring harnesses GM, Ford, Land RoverVAB Tychy, Poland Stampings GM Poland*VDO Instruments, Czech Republic Instrument panels, fuel management
systems Skoda, GM Poland,* Daewoo Avia (1999)Volkswagen Elektricke Systemy, Slovak Republic Cabling systems VW Bratislava, Skoda, Audi HungaryVSZ, Slovak Republic Steel products Skoda, VAZ Togliatti, Daewoo, Dacia, Fiat,
Mercedes, FordWix-Filtron, Poland Filters Fiat, Daewoo FSO, Daewoo LublinYazaki Debnar, Slovakia Wiring harnesses FordZK Kuznicze Ltd, Poland Metal forgings Rockwell International, Dana, Fiat Auto Poland,
Daewoo FSO, GM, TRW Steering Systems Poland
*Under construction
Who Continued from Page 5
20 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
1998June 2-5 Dusseldorf, Germany Int’l Symposium on
Automotive Technology & AutomationJune 3-14 Buenos Aires, Argentina Auto ShowJune 6-11 Brno, Czech Republic AutoTecJune 18-20 Beijing, China Automotive Sourcing in ChinaJune 22-27 Kiev, Ukraine Auto ShowJune 23-30 Beijing, China Auto China ’98June 24-25 Vienna, Austria Commercial Opportunities in
CIS Auto Industry ConferenceJune 24-28 Rio de Janeiro, Brazil Auto Brazil 98August 26-30 Moscow, Russia Moscow Int’l Motor ShowSept. 3-10 Hanover, Germany Auto ShowSept. 14-16 Nagaya, Japan Int’l Symposium on Advanced
Vehicle ControlsSept. 15-20 Nitra, Slovakia Autosalon NitraSept. 15-20 Frankfurt, Germany AutomechanikaSept. 18-27 Bucharest, Romania Bucharest Motor ShowSept. 27-Oct. 1 Paris, France FISITA World CongressSept. 29-Oct. 1 Detroit, MI Int’l body Engineering ConferenceSept. 29-Oct. 4 Budapest, Hungary AutotechnikaOct. 1-3 Brussels, Belgium Int’l Electric Vehicle
SymposiumOct. 1-11 Paris, France Int’l Road Transport ExhibitionOct. 1-11 Paris, France Int’l Paris Motor ShowOct. 6-8 Detroit, MI Global Powertrain CongressOct. 8-12 Ho Chi Minh City, Vietnam Auto Vietnam 98Oct. 13-15 Amsterdam, The Netherlands InterAuto ’98Oct. 16-25 Sydney, Australia Int’l Motor ShowOct. 16-25 Panama City, Panama Panama Auto ExpoOct. 23-Nov. 1 Birmingham, UK British Int’l Motor Show
Exhibitions, Conferences, and Shows in 1998 & 1999
Poland, constitute 75% of the region’svehicle market. Hyundai owns itsimporter in the region’s dominantmarket, Poland, which contributes over40% of the overall regional volume.
Dealer Networks
Average dealer network size andstructure for each of the make groupingsin 1997 are outlined in the nearby chart.
The network data clearly reflects theearly lead enjoyed by the Korean makes,with Daewoo taking the lion’s share notonly of the Korean makes, but all othergroupings as well. Hyundai and Kia’snetworks are very similar in size to the
Distribution of AsianCars in Eastern EuropeElaine Hardy, Project Director,Harbour Wade Brown
National Sales Companies
In 1997, all Asian makes in EasternEurope (including Central Europe, TheBalkans and The Baltics), exceptDaihatsu and Subaru, enjoyed effective95-100% coverage. Daihatsu is absentfrom ten countries (reaching only 37% ofpotential buyers) and Subaru is absentfrom six.
Only three of the makes own anyimporters or sales organizations in theseregions: Daewoo has six, includingthree linked with its manufacturingactivities in the Czech Republic, Poland,and Romania. It also owns its importersin the other Central European countries:Hungary, Slovakia, and Slovenia. Thesesix countries are the highest volumemarkets in the region.
Honda owns its importers in four of thefive most advanced markets (i.e. those ofCentral Europe). These four countries:Czech Republic, Hungary, Slovakia, and
average for Western European volumemakes.
Amongst the Japanese makes, Suzukihas the largest network — 200 maindealers — the second largest of anyAsian make. Sixty-percent of Suzuki’snetwork is located in Hungary where ithas its vehicle manufacturing operationand where it is the second leading sellerbehind Opel.
Excluding Suzuki, the smaller Japanesemakes’ average network falls to only 25main dealers. Proton is also an Asianmake (albeit Malaysian) and hascaptured a small market, mainly inCroatia and Slovenia.
Oct. 29-Nov. 1 Istanbul, Turkey Commercial Vehicles ’98Oct. 29-Nov. 8 Sao Paulo, Brazil Brazil Int’l Automobile Trade
ShowNov. 4-7 Bangkok, Thailand Asia Automotive ’98Nov. 4-8 St. Petersburg, Russia St. Petersburg Auto &
Service ShowNov. 5-8 Istanbul, Turkey Auto ShowNov. 12-15 Cairo, Egypt, Cairo Motor ShowNov. 14-22 Suntec City, Singapore Singapore Motor ShowNov. 17-21 Sofia, Bulgaria Bulgaria Int’l Specialized Trade
ShowNov. 26-Dec. 6 Montevideo, Uruguay Montevideo Motor ShowNov. 27-Dec. 6 Essen, Germany Essen Motor ShowNov. 30-Dec. 2 Graz, Austria SAE Total Life Cycle Conference
& ExpositionDec. 2-5 Jakarta, Indonesia Indonesia Auto ShowDec. Detroit, MI SAE Global Vehicle Development
Conference1999Jan. 16-24 Brussels, Belgium Brussels Int’l Motor ShowFeb. 4-14 Amsterdam, The Netherlands Int’l Motor ShowMarch 11-21 Geneva, Switzerland Geneva Int’l Motor ShowApril 8-16 Stockholm, Sweden Stockholm Int’l Motor ShowMay 22-30 Barcelona, Spain Barcelona Int’l Motor ShowMay 27-June 1 Poznan, Poland Int’l Automotive ShowNov. 13-21 Athens, Greece Athens Int’l Motor Show
Visit Trade Events under the Expert Directories at http://www.cear.comTo list Contact Information for your show contactTel: +1-440-843-9658, Fax: +1-206-374-5282, Email: [email protected]
Average Dealer Network Size and Structure (1997)Main Secondary Total
Koreans: Daewoo 531 0 531 Hyundai/Kia 173 0 173 Overall Avg. of the 3 makes 292 0 292Major Japanese Avg. 125 11 136Medium Japanese Avg. 106 2 108Smaller Japanese Avg. 83 0 83Proton Avg. 16 0 16Western European Volume Makes Avg. 171 38 209
Note: Daewoo’s total includes 420 dealers in the three markets in which it has vehiclemanufacturing facilities. Source: Harbour Wade Brown
© Central European Trade & Marketing, L.L.C. 1998 http://www.cear.com ™ CENTRAL EUROPE AUTOMOTIVE REPORT™ • June 1998 21
Hungarian Automotive Parts and Components SuppliersCEAR™BEROHA
Maria NemethTel: [36] 1-1298233Fax: [36] 1-129-8233
BERVA Finomsz. Kftpneumatic door
controls, absorbersprings, shock
absorbersDezso Boldi
Tel: [36] 36-411556Fax: [36] 36-411112
BERVINAHajtastechnikai Bt.polyurethane belts,special fan belts,plastic moldingLaszlo Bernath
Tel: [36] 1-2524829Fax: [36] 1-2524829
BHGHiradastechnikaiswitching technique
systems, cablestrands, integrated
circuit boardsAgnes Hegyi
Tel: [36] 1-2045718Fax: [36] 1-2045648
BMT IpariKereskedelmi
engine and otherparts
Dr. Miklos FerencTel: [36] 28-310031Fax: [36] 28-310013
BORSOCHEM Rt.PVC semi-products,
finished goodsTel: [36] 48-310211Fax: [36] 48-354496
Borsodi Gepkocsi Rt.Gyorgy Dudas
Tel: [36] 46-358500
Fax: [36] 46-358070
BPW RABAFutomugyar Kft.
trailer undercarriagesfor road and farm
vehiclesKaroly Ersing
Tel: [36] 94-328003Fax: [36] 94-328002
BSX GyartoSzolgaltato Kftpassenger car
clutchesLaszlo Bernhardt
Tel: [36] 72-482363Fax: [36] 72-482363
Budalakk Ker esFestekgyarto Kft.paints for vehicle
industryTel: [36] 1-1695688Fax: [36] 1-1697618
Budomobilcar fittings
Tel: [36] 1-1612658Fax: [36] 1-1810448
Caroflex fekbetetgyarfriction linings for
passenger cars andother vehiclesEva Szilagyine
GajdosTel: [36] 45-415219Fax: [36] 45-415217
Csepel AutoDugattyu
pistons, piston ringsTel: [36] 60-349015
Csepel Autogyar Kft.trucks, car frames &components, powersteering, clutches,
cardansPal Dagi
Tel: [36] 24-368117Fax: [36] 24-366911
Csepeli Csogyar Rt.precision tubes
Tel: [36] 1-2766172Fax: [36] 1-2768534
Csonka JanosGepgyar Kft.
air brake devicesTel: [36] 1-1667644Fax: [36] 1-1612265
Daikin-Bakanyclutch disks and
structuresBalazs Banai
Tel: [36] 34-311117Fax: [36] 34-311122
DAM Diosgyori Kft.hot rolled rod profiles
Tel: [36] 46-379811Fax: [36] 46-332417
DANUVIA GepipariRt.
valves, plates, cylin-ders
Bela HalaszTel: [36] 1-1831973Fax: [36] 1-1832763
Digep Holdingpower tools, front
axles, pumps, forgingmachines, clutchesDr. Kosaras Csaba
Tel: [36] 46-2045348Fax: [36] 46-2044365
DunaferrLemezalakito Kft.cold-worked plate
profilesTel: [36] 25-381256
Fax: [36] 25-310780
Dunaferr, AcelmuvekKft.
hot rolled steel coil,block
Tel: [36] 25-311522Fax: [36] 25-313901
DWA Dunaferr VoestAlpine Kft.
cold rolled steel strip,coil
Tel: [36] 25-383271Fax: [36] 25-383565
East-Sole Kft.processing of rubber
industry products, gluemaking, aluminum
foundingIstvan Kiss
Tel: [36] 56-477212Fax: [36] 56-450748
Eckerle Kft Hungaryelectrical partsIstvan Hunyadi
Tel: [36] 78-311150Fax: [36] 78-311150
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22 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
Reverse Flow Catalytic Converter & Fuel InjectionSystems Cut Emissions
New Product Review
The Canadian-based Alternative FuelSystems has introduced a patentedreverse flow catalytic converter withapplications for all internal combustionengines, including gasoline. Thecompany has also developed a fuelinjection system for converting gasolineand diesel engines to burn cleaner fuels.Both products are especially suitable foruse in regions plagued by high pollutionlevels.
The revolutionary catalytic converterhas been jointly developed by AFS andthe US company Matros Technologies.It uses a unique process for increasingthe temperature within the converter,which significantly reduces emissions toacceptable levels or lower by greatlyenhancing the catalytic process. A U.S.patent has been accepted and a globalpatent application has been submittedfor targeting certain countries.
The development of the reverse flowconverter began back in 1995 when atechnical presentation given by AFSvice president Ed Mirosh on diesel dual-fuel technology was heard by Dr. YuriMatros, an expatriate Russian scientistwho had emigrated to the United States.
Dr. Matros was experienced inconverting low heat, high volumeexhaust gas streams from chemicalplants using a reverse flow conceptinvolving immense catalysts andreversing valves. By modeling thesereactions, he was confident he couldadapt the process for treating low heat,low volume exhaust gases from engines.
Dr. Matros and Mr. Mirosh began adialogue that resulted in a program oftesting and mathematical modeling thatlead to a patent application in 1996. Dr.Mirosh and AFS engineer Dr. MingZheng fine-tuned the concept. Furthertesting was conducted by a University ofAlberta team of research scientists andpartially funded by the NationalResearch Council of Canada.
No hydrocarbon fuel is completelyemissions free, but the AFS reverse flowcatalytic converter comes close toeliminating methane and carbonmonoxide from the exhaust ofhydrocarbon fueled vehicles.
The unique character of the reverse flowconverter has brought invitations for
AFS personnel to present technicalpapers this year at various automotiveconferences, including the Society ofAutomotive Engineers (SAE)International Congress in Detroit, theInternational Conference and Exhibitionfor Natural Gas Vehicles in Cologne, theFISITA World Automotive Congress inParis, and conferences on catalysis inRussia and Italy.
AFS has also developed fuel injectionsystems for converting gasoline anddiesel engines to cleaner burningcompressed natural gas (CNG) andpropane (LPG) — the AFS Eagle, amulti-point diesel dual fuel managementsystem, and the AFS Sparrow, used forconverting gasoline engines to CNG orLPG. Both are simple to install, do notreduce engine power, and increaseoperational efficiency.
The AFS Eagle dual-fuel system has beentested in pilot projects in cities such asTokyo, Sao Paulo, Osaka, Seoul, andPusan. In Mexico City a project waslaunched in late December 1997 toconvert microbuses and other vehiclesfrom gasoline to CNG using the AFSSparrow. Some10,000 vehicles per yearover a 10-year period will be converted ata cost of $2,000 each. The Mexico Cityproject will provide a model for othercities around the world facing similarpollution problemsn
• Powertrain Review• Skoda’s Detlef Wittig• Slovak Car Park Analysis• More Supplier Lists• Hungary Tax/Customs Update• Poland Sales Statistics• Quality Lesson 4•Bulgarian Sales & Production Review• Exporting to Central Europe• How to Measure Your Intellectual Capital
FUTUREISSUES
Passenger Cars Commercial Vehicles
Make Volume Market Share Make Volume Market Share
FIAT 44,223 32.16% DAEWOO MTR. 3,121 25.24%
DAEWOO 38,126 27.72% DAEWOO 2,662 21.53%
GM - OPEL 10,558 7.68% CITROEN 1,252 10.12%
SKODA 6,658 4.84% MERCEDES 1,011 8.18%
RENAULT 5,344 3.89% VW 807 6.53%
FORD 5,134 3.73% FIAT 696 5.63%
VW 4,339 3.16% SKODA 672 5.43%
TOYOTA 4,308 3.13% FORD 448 3.62%
HONDA 4,284 3.12% PEUGEOT 428 3.46%
SEAT 3,394 2.47% IVECO 332 2.68%
Source: SAMAR, s.c.
Best Selling Brands in Poland (YTD March 1998)Ranking By Retail Volume
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24 June 1998 • CENTRAL EUROPE AUTOMOTIVE REPORT™ http://www .cear.com ™ © Central European Trade & Marketing, L.L.C. 1998
Company: Daewoo Motor SlovakiaLocation: Bratislava, Slovak RepublicContact: Peter Halgas, MarketingManagerBusiness: Distribution & Sales
Daewoo Motor Slovakia has chosenPiestany, Slovakia as the site for its newSK 140 million ($4 million) operationand service center. “Due to the big salesvolume [of Daewoo cars] in 1996 and1997, we need to satisfy our customers,”Peter Halgas, Marketing Manager forDaewoo Motor Slovakia told the CEAR.“We feel it’s our obligation.”
The 17,000 square meter center willhave multiple functions. For the public,it will be used for sales and service.Cars will be sold and serviced at thecenter, and spare parts will be availablefor purchase.
The facility will also serve Daewoo’sSlovak dealer network as a wholesale carand spare parts center. A spare partsstock area will store parts bound forDaewoo’s Slovak service centers.Storage space for some 300 cars will beavailable for vehicle inventory. And anew education center will providetraining for dealers and dealer’s
technicians.
Daewoo currently operates out of arented facility in Piestany. Constructionof the new center began in June of 1997and operations are expected to begin inearly May. “The spare parts stockingfacility is already completelyoperational,” said Halgas. By the end ofApril, Daewoo plans to move from its oldfacility in Piestany to the new center.
Piestany was chosen by Daewooprimarily because the previous Daewooimporter had established a stockingfacility and bonded area in Piestany. “Itwas very useful to use these facilities,very convenient,” said Halgas. “And forthe dealers, it’s more convenient thanBratislava. And the operational expensesare lower in Piestany, than, for example,in Bratislava.”
Passenger cars find their way to Slovakiathrough the port of Koper in Slovenia,where they’re loaded onto railwagonsand then pulled into Piestany. “Due tolegislative conditions that requirepayment of customs duties and VAT inadvance, in the future it will be moreadvantageous for us to bring the carsfrom Koper according to needs,” said
Halgas. “In accordance with thestructure of sales preferences, we willkeep some cars [in inventory inPiestany] and then we’ll continuouslyresupply.”
Daewoo Motor Slovakia is gearing upfor the addition of new models to itscurrent line-up that includes the Lanos,Nubira, and Leganza. The replacementfor Daewoo’s popular Tico model — theMatiz — will go on sale in Slovakia inAugust or September. Having takenover Ssang Yong Motors in January1998, Daewoo is also preparing to startsales of Ssang Yong Motors models.
Daewoo Motor Slovakia will also beginselling light commercial vehicles fromregional Daewoo operations, includingthe FSO and Lublin II models fromPoland, and Daewoo Avia trucks fromthe Czech Republic.
Piestany, of course, is happy to haveDaewoo as a neighbor. “The newDaewoo facility will make Piestanymore attractive and will provide moreemployment opportunities,” saidAntonia Vitekova, Director of thePiestany mayor’s office.
And last year, Daewoo GroupChairman Kim Woo-Choong donatedSK 5 million to Piestany to developsocial programs in the city. Most of themoney has been earmarked forreconstructing and repairing churchesand religious schools in Piestanyn
Daewoo Sinks $4 million Into New Operation& Service Center in SlovakiaCompany Spotlight
Segment YTD SALES (Units) CHANGE (%) MARKET SHARE (%) SALES IN MARCH
1998 1997 1998 1997 1998 1997
1. Segment A 34,457 36,094 -4.54 25.06 27.63 13,794 12,010
2. Segment B 27,487 33,141 -17.06 19.99 25.37 11,276 11,035
3. Segment C 58,371 41,753 39.80 42.44 31.96 21,060 16,896
4. Segment C/D 14,290 17,458 -18.15 10.39 13.36 5,629 4,532
5. Segment D/E 1,733 635 172.91 1.26 0.49 806 262
6. Segment F 31 29 6.90 0.02 0.02 21 15
7. Segment S 298 586 0.00 0.00 0.00 142 195
8. Segment MPV 695 778 0.00 0.00 0.00 264 388
9. Segment 4WD 163 161 1.24 0.12 0.12 86 50
Total Passenger Cars 137,525 130,635 5.27 99.28 98.96 53,078 45,38310. Light Comm. Segment 5,714 7,243 -21.11 46.21 55.07 2,261 2,671
11. Medium Comm. Segment 6,652 5,910 12.55 53.79 44.93 2,498 2,172Total Commercial Vehicles 12,366 13,153 -5.98 100.00 100.00 4,759 4,843
Source: SAMAR s.c., Local Manufacturers and Official Importers, ACEA
Polish Vehicle Market Segmentation (YTD March 1998)
© Central European Trade & Marketing, L.L.C. 1998 http://www.cear.com ™ CENTRAL EUROPE AUTOMOTIVE REPORT™ • June 1998 25
LABOR FORCE Number Growth (%) 1
•Paid Employment 651,225 0.2—In Enterprises & Companies 593,086 -0.7—By Self-Employed Persons 58,139 10.3•Self-Employment 92,204 0.9•Unemployment (registered) 125,188 4.5•Registered Unemployment Rate (%) 14.4 -•ILO Unemployment Rate (%) (Spring ’97) 7.1 -•Paid Employment By Sector of Activity December 1997 Share (%)—Agriculture 8,919 1.4—Industry (includes construction) 290,524 44.7—Services 350,248 53.9
WAGES & LABOR COST Dec. 1997 (SIT)3 Growth % 4
•Monthly Avg. Labor Cost Per Employee2 209,543 9.8—Manufacturing 175,047 9.7•Average Hourly Labor Cost Per Employee 1,197 9.7—Manufacturing 1,000 9.6•Real Labor Cost Growth (%) - 0.9%—Manufacturing (%) - 0.8•Monthly Average Net Wage Per Employee 99,073 11.4—Manufacturing 83,301 11.7•Real Net Wage Growth (%) - 2.4—Manufacturing (%) - 2.7
1) January-December 1997 compared to January-December 19962) Including employers and employees social contributions, additional labor costs (annual holiday bonus, meal reimbursement,traveling reimbursement) and payroll tax.3) Avg. Slovenian Tolar Exchange Rate, December 1997: 1 US = 167.65 SIT4) December 1997 compared to December 1996
Source: Chamber of Commerce & Industry of Slovenia
Slovenian Labor Market Indicators (1997)
CEAR™ Extra Data For Email EditionThis Data did not fit in the Print Edition, but it is made available to Email Subscribers
Passenger Cars Light Commercial Vehicles Medium Commercial VehiclesMake Units Change Make Units Change Make Units Change
’98 v. ’97 ’98 v. ’97 ’98 v. ’97Units Units Units
FSO - Polonez 5,938 -6281 Fiat Cinquecento Van 125 -1100 FSC - Zuk 55 -162Fiat Cinquecento 9,902 -5383 FSO Polonez Truck 2,585 -594 Ford Transit 121 -125PF 126 11,136 -2627 Citroen C15 712 -220 Fiat Ducato 54 -60Daewoo Nexia 4,251 -2492 Ford Courier Van 66 -101 Citroen Jumper 33 -23Fiat Uno 4,474 -2121 Fiat Uno Van 414 -93 Toyota Hiace 18 -14Daewoo Espero 632 -2067 Peugeot Partner 166 -56 Renault Trafic 21 -5Renault Megane 2,729 -1853 GM - Opel Combo 220 -52 Nissan Vanette 4 -5Toyota Carina E 372 -1627 VW Caddy 83 -33Peugeot 406 831 -1492 Renault Express 15 -32Citroen AX 199 -1370 FSO Polonez Cargo 77 -27
Source: SAMAR s.c., Local Manufacturers and Official Importers, ACEA
Sales Loss Leaders in Poland (YTD March 1998)