Sunday, 19 November 2017

Gloomy outlook of Czech car industry stirs up passions

ČTK |
11 October 2017

Prague, Oct 10 (CTK) - The news that the Volkswagen (VW) concern is considering moving part of the production of Skoda cars from the Czech Republic to Germany has offered a dismal outlook of the future and many Czechs got scared by this, Marek Svehla writes in the latest issue of weekly Respekt.

The case exposed the fact that in several Czech regions the economy and employment depend on a single company, the decision making of which the Czech government cannot and will not be able to influence, Svehla writes.

Moreover, the production of Skoda Auto is based on internal combustion engines which are commonly considered obsolete technology that is going to be overshadowed by more modern vehicles. Even VW is getting ready for making electric cars, but the Czech Republic does not play a major role in this change, Svehla says.

The Czech Republic and Skoda are almost not involved in the development and manufacturing of electric cars. In the Czech car maker's seat, the central Bohemian town of Mlada Boleslav, the automotive engineers still believe that the combustion engine has good prospects and they plan to keep focusing on it, Svehla writes.

Last Wednesday, the Reuters news agency wrote that German VW managers and trade unions want to move some of Skoda's production to Germany and to make Skoda pay more for shared technology. On the same day, Czech trade unions and both government and opposition politicians started protesting against such steps.

On the next day, VW spokesman said there were no such plans to move car production away from the Czech Republic. But given the development of electric cars, the whole automotive industry is facing a lot of uncertainty and one can hardly trust the VW assurance, Svehla writes.

He says VW, which is now the world's biggest car producer, would behave very unreasonably if it were not at least considering making similar changes in its manufacturing structure, especially as Skoda is trying to hire enough qualified workers in vain, while the car plants in Germany would like to have more work.

Skoda is part of the German concern and the Czech production has been flourishing since the 1990s thanks to German money, Svehla writes.

He says though it is too early to expect any deadlines, big cities started seriously discussing a ban on cars with combustion engines.

The automotive industry clearly seems to be moving towards a transformation that may bring economic problems and social upheaval to the Czech Republic, Svehla writes.

It is hard to tell when this is going to happen and how strong the impact will be, however, the country should start getting ready for the expected change, he adds.

The possible move of a part of the production of traditional cars using petrol or diesel fuel to Germany might paradoxically be an opportunity to considerably speed up the Czech preparation for the changes. Such inconspicuous decisions made somewhere in the corporate world may be at the beginning of the changes that the Czech industry needs to make, Svehla concludes.

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