Czech companies


Mechanical engineering

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The Czech Republic has always been a major producer of transport equipment.

Between the world wars, Czechoslovakia was among the top 10 machine-building countries in the world. The dynamic development after the Second World War was influenced by both the international and domestic situation. Mechanical engineering became a core industry used to industrialize less developed areas.

Today, this industry is located throughout the country, having the most balanced geographical distribution. Apart from major machine works, there are a great number of smaller plants and local workshops. The weakness is the broad production range (60% of the worldwide product range) and the fact that it is spread over many plants.

The Czech Republic has been adjusting its standards to those of Europe since the 1990s. The Czech system has primarily adopted standards issued by the International Standards Organization (ISO) and by the European Committee for Standards (CEN). The Czech Standards Institute ensures international cooperation with the ISO and CEN in preparing standards for a particular field by means of contractually commissioned associations of machine-building firms.

The Czech Republic has always been a major producer of transport equipment. With its tradition of car manufacturing and its convenient location, the Czech Republic is a very attractive country for investment. In addition, it has seen marked growth of work productivity and takings. Czech automotive production accounts for a significant portion of the overall economic performance of the Czech Republic. Car manufacturing has been for many years very efficient and a significant section of the Czech economy. Progress was not just all positive in all commodity, but generally this growth trend gives good a presumption of expansion in this sector in the future.

The dominant position without any doubt occupies the manufacture of passenger cars, followed by the manufacture of buses and trucks. However, in 2004, the production of accessories again surpassed the production of vehicles. At the same time, the automobile industry forms almost one-fifth of domestic export and its representation in foreign trade is increasing.

Czech automotive production accounts for a significant portion of the overall economic performance of the Czech Republic. It also plays a crucial role in exports, and this role becomes even more important after the TPCA car production plant in Kolín was launched. Over 40 companies from the Top 100 global automotive corporations have established branches in our country. Most production is for export to EU countries. The biggest exporter has traditionally been ŠKODA Auto a.s. Its share of total Czech export is over 9 %. Total export of automotive accessories surpassed car export for more than two years. The foreign trade balance was almost 37 % of total sales. Škoda Auto a.s. and TPCA will export more than 80 % of their production, so export is expected to grow in coming years.

The most significant automotive area is the region of Central Bohemia. This stems mainly from the fact that Škoda Auto, the leading national car producer, is based in this region. The importance of the region of Central Bohemia as a region of major car producers will be emphasized by TPCA, the above-mentioned new car factory erected in Kolín. Utility vehicles are produced by Karosa – Irisbus (buses, coaches and trolley-buses in cooperation with Škoda Plzeň). Heavy trucks are manufactured by Tatra. At present, about 450,000 cars are made in the Czech Republic each year. In 2006, Škoda Auto and TPCA should in total produce over 750,000 cars. Higher production volume will also increase the value of exports. Over 140,000 new cars are sold in the Czech Republic each year, of which Škoda Auto a.s. sells about 70,000.

Significant engineering fields in the Czech Republic also include the manufacturing, repairing and upgrading of rail vehicles. The most important manufacturers include: KD Vagonka, DPO Inekon, Krnovské opravny a strojírny, Bonatrans, Pars Nova, Škoda Plzeň and Siemens Kolejová vozidla.

All kinds of rail vehicles are manufactured in the Czech Republic, including metro trains, trams, and trolley-buses. Aircraft manufacturing is one of the top engineering industries, which uses the latest findings of science and research, production process technologies, and new materials, thus initiating technical progress in a number of other fields. The production of training jets and lightweight fighter planes, regional aircraft, training and sports aircraft (www.aero.cz), gliding planes, airplane components, and ultra-light planes has been dynamically developing over the recent years.

There are 10 final producers of these planes in the Czech Republic, with a total annual production of some 350 units, of which 80% are exported. An additional 10 firms specialize in producing aircraft components. This segment employs around 1,500 staff, and the total annual sales reach some CZK 600 million. After Germany, the Czech Republic is the second-biggest manufacturer and exporter of sports planes in Europe.

The Czech Republic also has manufacturers of river and river/sea cargo ships, sports boats, yachts, motorcycles and bicycles. Hot-air balloons are produced in Brno. The space research program also contributes to the good name of Czech science and engineering, although its volume is marginal. Other significant fields of production include the manufacture of equipment for the industry, and construction, manufacture and repair of steam and water turbines, pumps and compressors.

Škoda Plzeň is a major manufacturer of turbines even on an international scale. The Czech Republic also produces machine tools and metal forming machines. These products are manufactured by Tajmac-ZPS, Kovosvit and Mas Bomar for example, while Narex produces electrical power tools of quality acknowledged worldwide.

The largest part of Czech production is traditionally channeled to EU markets, especially traditional German markets. The components of railway stock, river-sea cargo ships and sports, training and ultra-light aircrafts present the decisive export item. A significant sales area of the Czech aircraft industry, the aircraft components and sport aircraft, respectively, is the United States. The main import items are large transport airplanes, helicopters and their parts.

In recent years, a decline of receipts was recorded within the manufacture of aircrafts and railway vehicles, which was caused by a lack of financial resources, i.e., by shifting the planned modernization of Czech Railways rolling stock as well as that of some transport enterprises. As far as the aircraft industry is concerned, receipts were influenced by instability or the inability of key aircraft manufacturers to acquire sales of their production. On the contrary, the commencement of favorable trends was recorded in the manufacture of ships, motorcycles and bicycles.

Mechanical engineering perspectives

The strategic objective of transport engineering may be seen in such industrial potential that would be fully comparable with the European Union in its contribution to GDP and in the quality and effectiveness of production, including labor productivity. A challenge will be to find sales areas
and ensure enough financial means for such manufacturing technologies, which, together with the effective organization of labor, will safeguard cost competitiveness. Thus the difference between the Czech Republic and the European Union in labor productivity will decline, and new jobs will be created.

The midterm priorities of the industry must be based on enterprise and research programs, which  should incorporate university research. High ambitions for the productivity of products are possible only by seeking out new manufacture possibilities. It will be possible under the presumptions of the high level of science and its technological applications and of the higher capital concentration to create the economical base necessary for a higher level of the research and development.

Foreign markets are mainly EU countries, and in the future, also the region of Eastern Europe and Russia, where our manufacturers are regaining their strong position. The dominant customer of the industry continues to be Germany.



Added: 29.12.2009

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