INVESTMENT OPPORTUNITIES

Automotive Industry
in the Czech Republic

Contents
1
The Czech Automotive Industry at a Glance

12
Czech Technical Universities and Automotive
R&D Projects

2
Passanger Car Manufacturers

13
Education and Workforce

4
Buses and Commercial Vehicles

14
Labour Market

6
OEM Supplier Case Studies in the Czech Republic

15
Financial Support

10
Top Automotive R&D Location

16
Automotive Supplier Database

11
Selected Czech-Based Technology Centres

Last update: February 2015

www.czechinvest.org

The Czech Automotive Industry at a Glance

The Czech automotive

sector had a record-breaking year in 2014
with 1,278,000
motor vehicles
manufactured.

Success breeds success and this adage certainly epitomises the Czech Republic, which hosts one
of the highest concentrations of automotive-related manufacturing and design activity in the world.
With passenger car production at 107.5 vehicles per 1,000 persons, the Czech Republic has
maintained its supreme position among world automotive leaders in terms of per-capita output.
It is also among the fifteen largest global passenger car producers by volume. The Czech
automotive industry employs more than 150,000 people and accounts for more than 20%
of both Czech manufacturing output and Czech exports.
The Czech automotive centre of excellence plays a key role not only in the European but also in the
global perspective. Based on the countrys century-long engineering tradition, good infrastructure
and skilled workforce, it significantly contributes to automotive manufacturing and R&D.
While the country has the capacity and resources to accommodate three major carmakers
koda Auto (Volkswagen group), TPCA (Toyota/PSA joint venture) and Hyundai Motor
Manufacturing Czech and holds excellent business opportunities for suppliers, the Czech
Republic is poised to consolidate its position as one of the leading European centres for
automotive-related design and R&D activity.

Why to Invest in the Czech Republic

-- Strategic location in Central Europe; direct access to the EU market of 500 million consumers;
time and logistics advantages
-- Highly integrated into the European automotive value chain
-- Well-developed transport and telecommunications infrastructure
-- Robust supplier base
-- Highly educated workforce, good access to university graduates with technical education
-- Strong innovation potential for R&D projects
-- Positive approach of the Czech government, investment support covering up to 25%
of eligible costs through a transparent system of investment incentives
-- First-class support from CzechInvest

1,277,875
2014

1,134,285
2013

1,181,314

1,077,166
2010

2012

983,992
2009

1,201,000

948,128
2008

2011

939,788
2007

449,891
2004

855,832

443,902
2003

2006

454,968
2002

Source: AIA 2015

603,849

470,589
2001

Roberto Vavassori,
Business Development Director, Brembo

2005

459,357

Production of Motor Vehicles in the Czech Republic

2000

We are convinced about the

appropriateness of our decision to
kick off our new facilities for the
production of premium brakes in the
Czech Republic. In this country we
are finding skilled human resources
and authorities ready to support our
challenging start-up. Thanks go
also to CzechInvest, which facilitated
our decision through its professional
assistance.

Passenger Car Manufacturers

The characteristics of todays Central

European automotive industry as I see
them are state-of-the-art technology and
highly competitive factories; a highly
skilled workforce and long tradition in
engineering together with favourable
wages and especially unit costs. And
last but maybe most important, access
to know-how and division of labour. In the
Czech Republic ten years ago our role
solely was to maintain and exploit these
advantages.

Dr. Carl H. Hahn, Honorary Chairman,

former Chairman of the Board
of Directors, Volkswagen AG

koda Auto:
120 Years of Automotive History
In 1895, Vclav Klement and Vclav Laurin founded their business in Mlad Boleslav.
This makes KODA one of the oldest automobile brands in the world. In 1991
KODA AUTO became Volkswagen Groups fourth brand after VW, Audi and Seat. Management,
marketing, product development and production processes underwent fundamental modernisation.
In 2001 the brands first plant outside Europe was built in Aurangabad, India. Production of KODA
models was launched at the Volkswagen Groups plant in Shanghai, China in 2005.
KODA AUTO is continuing to successfully implement its growth strategy. In 2014 the Czech
carmaker achieved the best sales year in its history, delivering 1,037,200 vehicles. In 2014,
the comprehensive model campaign, which had been initiated four years previously, was once
again the top priority for the Czech manufacturer. In March, the pioneering KODA VisionC
concept was the first highlight of last years KODA model premieres. The Octavia G-TEC,
Octavia Scout, three special Monte Carlo editions for the Citigo and Yeti and Rapid Spaceback
were introduced over the course of 2014. In November the new KODA Fabia provided
the grand finale of last years model roll-outs.
The Octavia is the heart of the brand. The third generation Octavia is proving to be a massive hit,
with worldwide sales totalling 389,300 in 2014. The KODA Rapid performed extremely well
and became the second best-selling model with 221,400 units delivered. The KODA Fabia
achieved sales of 160,500 units last year. In addition, the KODA Yeti achieved sales of 102,900
units, the Superb attracted 91,100 customers and the smallest model in the line, the Citigo,
had sales of 42,500 units. The KODA Roomster won over 29,600 customers around the world.
As part of its model and design campaign, the company is further strengthening its marketing
activities on both the European and international markets. To support the plan, KODA
is continuously investing in the expansion of its Czech production plants in Mlad Boleslav
and Kvasiny. In addition to strengthening the companys solid position in Western Europe
(+11.8% in 2014), the Czechs are also focusing on the growth market of China, which is KODAs
strongest individual market with total sales of 281,400 units in 2014.

koda Auto operates

13 plants in six
countries in Europe
and Asia and exports
passenger cars to more
than 100 markets
around the world.
www.skoda-auto.cz

Since 2008, we have developed our

business to become a truly European
brand. Our Czech plant is at the heart
of our European success, producing
the two best-selling Hyundai models
in the region and making one car every
minute. Its cars such as New ix35
and New Generation i30 that have
helped us achieve a record-high
European market share of 3,5%
in 2012.

Allan Rushforth,
former Senior Vice President and COO,
Hyundai Motor Europe

Hyundai Motor Manufacturing Czech

The Most Modern Carmaker in Europe
Another success story began with the announcement of a EUR 1 billion
investment in Noovice, Moravian-Silesian Region, in 2006. At that time, the
Korean car manufacturer Hyundai Motor Company decided to build here its very first production
facility in Europe, which according to expert opinion is currently the most modern car factory in
Europe. By building this factory, Hyundai Motor Company expanded its global production network,
which includes other manufacturing facilities in Korea, China, India, the United States, Russia,
Brazil and Turkey.
Hyundai Motor Manufacturing Czech (HMMC) produces three passenger-car models ix20, ix35
and i30. The manufacturing facilities consist of a stamping shop, a welding shop, a paint shop,
a final assembly shop and two transmission shops. The transmission shops are of particular
importance as they produce transmissions not only for HMMC but also for its sister company
Kia Motors Slovakia in ilina. Conversely, Kias Slovak plant provides HMMC with motors,
thus creating a unique complex of mutually cooperating units.
The importance of Hyundais huge investment, one of the biggest in the Czech Republic to date,
was also based on the fact that Hyundai came to the Moravian-Silesian Region in the nick of time,
so to speak, as the region suffered from high unemployment resulting from painful restructuring
processes in its traditional industries. Hyundai offered to create approximately 3,300 jobs and
additional 7,000 were created by component suppliers that followed Hyundai to the Czech
Republic. The Czech government and the Moravian-Silesian Region followed up this investment
by spending billions of Czech crowns on infrastructure, particularly roads and railways.

www.hyundai-motor.cz

At the beginning we expected from the

Czech Republic benefits like the long
tradition of the automotive industry with
a developed network of suppliers and
a good location in the middle of Europe
close to markets with good potential
for future growth. Now, after almost ten
years in the Czech Republic, we confirm
that we made the right decision for our
new home ground. Not just because
of the well-known benefits, but we
also recognise the capable and skilled
manpower that is willing to learn
earn and
improve itself. This is essential
tial for our
future growth.

Satoshi
shi Tachihara,
former President
ident of TPCA

In 2008, manufacturing capacity was set at 200,000 cars per year, a figure that was reached
after only two years of production. Upon initiation of three-shift operation in autumn 2011,
the maximum capacity of Hyundai Motor Manufacturing Czech has risen to 300,000 cars
per year. Because the production plans were exceeded in 2013 and 2014, HMMC plans
to produce 330,000 cars in 2015.

Toyota Peugeot Citron Automobile

Green Factory in the Centre of Europe
Toyota and PSA Peugeot Citron launched production of cars at the TPCA (Toyota Peugeot Citron
Automobile) plant in the Czech Republic in early 2005. Four years after the carmakers unveiled
their joint-venture project and three years after they chose a site near the Czech town of Koln,
the first cars rolled off the production line one each of the new Toyota, Peugeot and Citron
models. TPCA have produced totally more than 2.5 million of cars till nowadays.
The facility was designed primarily by Toyota, the partner that took most of the responsibility
for manufacturing. PSA Peugeot Citron is responsible for the supplier network of TPCA.
TPCA has been constructed as one of the greenest factory in Europe. From the beginning,
TPCA pays attention for the investments into the most environment-friendly production
technologies and promotes environment-friendly thinking of employees. Its results of energy
and water efficiency highly above the industry aver
ver
errage
a
confirm the success of this effort
average
as well as the results of waste mana
a gement
an
ntt system
n
mw
ith low
wp
roduct
c ion of waste and high
management
with
production
ratio of recycling. At around EUR
R 7
50 mill
liio
on, the
e sstate-of-the-art
tate-off the-artt p
fla t located about 60
lan
750
million,
plant
kilometres east of Prague iis
so
ne of the
th
h biggest fo
for
oreig
or
reign
eig
gn iinvestments
nvestm
nv
nve
s ents in
nC
entral Eu
E
rope to date.
one
foreign
Central
Europe
The capacity of the
e plant
p
is 3
00,000
0 vehicles
v hic
ve
hicles
icle
le pro
odu
o
du
d ced
duced
ce
ed
d iin
no
on
ne yyear.
ea
ear
a.C
u ently
ur
urr
yT
PCA prod
ro uces
300,000
produced
one
Currently
TPCA
produces
new generation of mod
models Toyota A
ygo
ygo,
go, P
eugeot
ott 10
108
8a
nd C
nd
itro
n C1
C
1, ssmall
1,
mall city cars
rs
s wi
w
ith low
Aygo,
Peugeot
and
Citron
C1,
with
fuel consump
ption and
d em
emi
m ssi
sions
si
o .
on
consumption
emissions.
percent
supplies
than
99%
cars
Roughly 80 perc
erc
rcent o
rc
off su
suppl
upp
p ie
es come from the Czech Republic. More tha
es
ha
an 9
9%
% o
off the ca
c
rs
exported
European
markets,
Kingdom,
Netherlands
are expor
p ted to Europ
po
op
pean
a ma
an
m
mar
arke
rk ts, mainly France, Italy, the United Kingd
dom,
om
m,, th
m
the N
the
etherlands
Germany.
and Ge
erma
rm
m ny
ny TPCA has roughly 3,000 employees.
ny.

www.tpca.cz

Buses and Commercial Vehicles

SOR Libchavy
SOR Libchavy, the leading Czech bus and coach producer, was established in 1991 and its first
bus was on the road only two years later. The company currently produces 550 buses of its own
design in all categories annually. Compared with the competition, the main benefit of SORs
buses is their low weight, which on average is up to two tonnes lower than comparable buses
from other manufacturers. Due to this lower curb weight, fuel consumptionis 14.5% less than
that of other types of buses in the market.
SOR Libchavy produces buses in city, intercity, tourist and low-floor city versions. These buses
have been equipped with IVECO Euro VI engines as standard since 2014.
Another innovation in the pipeline is the production of two more fullylow-floor city buses.
For the intercity bus segment, SOR offers three mid-floor models as well as a low-entry version.
The company also produces electric buses, trolleybuses and CNG buses. SOR obtained
ISO 9001 certification in 2001. Exports account for around 50% of total output, and increased
production is aimed at foreign markets like Slovakia, the Baltic states, Serbia, Moldova, Russia,
Ukraine, Denmark, Belgium, Holland, Germany, Croatia and Bulgaria.

Commercial Vehicles
www.sor.cz

Iveco Bus
Iveco Czech Republic, with its headquarters in Vysok Mto, is the
largest factory of the Iveco Group, the second largest bus manufacturer
in Europe. The company focuses mainly on production of intercity buses, though starting in 2011
the production programme newly includes Citelis 10.5 m and 12 m city buses with diesel and CNG
engines, as well as bodies for trolleybus versions.
Iveco Czech Republic also offers the widest range of products of the entire Iveco Group, including
minibuses, tourist coaches and city, suburban, long-distance and intercity buses. Fundamental
diversification over the last three years has resulted not only in new designs, improved passenger
comfort and outstanding consideration for the environment, but also great value for money,
thanks to the quality, life service and low operating costs of the buses. In addition, a focus
on environmental friendliness has brought about a significant expansion of the range of buses
on offer that use alternative fuels.
In the area of city transport, Iveco Bus is maintaining its current position as the European leader
in terms of environmental protection, reduced emissions and expansion of the range of buses
powered by alternative fuels. The line of very popular low-floor Citelis city buses has been
expanded with the addition of the low-entry city/suburban/long-distance Crossway LE, which
has become a sought-after model and is offered in a three-door version. The traditionally very
strong position of Iveco Bus in the segment of long-distance coaches continues to be supported
by the Arway and Crossway models.

www.iveco.com

KODA ELECTRIC
Is a leading global manufacturer of electric drive units and traction
motors for trolleybuses, tramways, locomotives, underground trains, etc. and is continuing
the long tradition of production at the koda Works in Plze, which began at the companys
Electrical Engineering Works in 1901.
KODA ELECTRIC offers its customers modern 12m, 15m and 18m low-floor trolleybuses.
Every koda trolleybus features all necessary electrical equipment housed in a container
on the vehicles roof. For travel outside of trolley lines, the buses can be equipped with
an auxiliary diesel generator that complies with the EURO VI standard or with a battery unit
including a microprocessor-controlled voltage inverter with the possibility of recuperation. koda
is a global leader in supplying trolleybuses to the whole world. In 2013 koda concluded
a record-setting order for 125 modern trolleybuses for Riga, Latvia, and also carried out major
orders for buses delivered to, for example, the Bulgarian cities of Sofia, Burgas, Pleven and
Star Zagora, as well as the Slovak capital, Bratislava.
Thanks to the companys extensive experience and successes in the area of development
and production of trolleybuses, it has incorporated into its portfolio a range of vehicles with
ecological alternative drive systems: the hydrogen-powered TriHyBus, series-produced Hybrid
H12 and the Battery bus. One of the companys key products in the area of e-mobility is its fully
battery-powered bus called the KODA PERUN (Pure Electric RUNner), which is a twelve-metre
low-floor electric bus with a KODA asynchronous traction motor and maintenance-free Li-Pol
traction batteries. For the purpose of charging the vehicle within a period of only eight minutes,
koda Electric also possesses a concept of automated charging infrastructure, which fulfils
the COMBO II global charging standard and is thus compatible with the infrastructure
developed for the automotive sector.

TATRA
TATRA TRUCKS a.s. is one of the oldest vehicle manufacturers in the world.
It has always been situated in Kopivnice, a town in the eastern part of the
Czech Republic, the Moravia-Silesia region.
TATRA TRUCKS a.s. has two subsidiaries Taforge a.s. and Tafonco a.s.
Its core production programme includes heavy-duty off-road trucks and vehicles for combined
off-road and on-road transport which have been continuously improved due to increasing
customer requirements. One important advantage of TATRA, a. s., not only in the field
of development but also production capacities, is the high level of human potential.
The TATRA brand trucks are based on the TATRA vehicle design which has not yet been successfully
copied by anybody. Heavy trucks from Kopivnice are famous for their passability through the
most difficult terrains in extreme climatic conditions, high reliability and excellent utility
characteristics. TATRAs can adjust to bitter frosts as well as abnormally high desert temperatures.
While other heavy truck manufactu
tu
urer
r s thatt o
re
riginatted
ed in the
e h
istorical
all territory of the Czech
manufacturers
originated
historical
state either did not exist for very
ry
y long
lo
llon
o g orr were
were swallowed
sw
wallowed
d up
up byy more
more successful ones,
the TATRA brand is still alive
ive
ve. It is tthe
he only one to
he
to keep
keep the
ke
kee
the
e flag of tthe
he Czech
he
hd
esign school
alive.
design
hoisted in its segmen
ent.
en
segment.

www.tatratrucks.com
cks.com

Did You Know

that 56 of the top 100 global top tier automotive
Airbag&Safety

Car Trim
Global Safety Textiles
GST Automotive Safety
Indet Safety Systems
(Nippon Kayaku)
Takata
Tokai Rika
Toyoda Gosei
TRW Automotive

Automotive Electronics
Akuma
Continental
Draka
Furukawa
Johnson Controls
KES - kabelov a el.
Systmy
Kostal
Leoni
Mitsubishi Electric
Satrema Int.
Takata
Tesla Blatn
Tesla Jihlava
Tokai Rika
TRW Automotive
TVM
TYCO Electronics
Yazaki

Brakes

Brembo
Continental
Cooper-Standard
Automotive
Federal Mogul
FTE Automotive
Knorr-Bremse
TI Group
TRW Automotive

Chassis

Benteler
Brano Group
Hyundai Mobis
Koyo Bearings
KYB Manufacturing Czech
Monroe Tenneco
Mubea
Schaefmer Group

Door Systems
& Car Locks

Assa-Abbloy
Brano Group
Brose
Construct Czech
Defend
Edscha

Inteva Products
Kiekert
Pyeong-Hwa
Tokai Rika
Witte

Engine System
Systems
ms

Aisin Seiki
Alfmeier
Almet
Bontaz-Centre
Brabant Alucast Czech
Brisk
Z Strakonice
Honeywell Turbo
Technologies
Jihostroj
Kolbenschmidt Pierburg
Magneton
Metalis Nejdek
Nemak
PBS Turbo
Robert Bosch
Strojirny Poldi
TRW Automotive

Exhaust Sys
Systems
stems
and Filters

Fuel System

Continental
Cooper-Standard
Automotive
Motorpal
Robert Bosch
TI Automotive
Toyoda Gosei

HVAC

Behr
Denso
Eberspcher International
Fujikoki
Ingersoll Rand
Keihin
Senior Automotive
TI Automotive
Valeo
Varroc Automotive Systems

Magna International
MEGATECH Industries
Recticel
Rieter CZ
Tomatex

Lighting Systems

Automotive Lighting
Hella Autotechnik
Koito
Halla Visteon Autopal

Rubber and Plastics

Controls)
Johnson Controls
Karsit
Lear
Magna International
Viza Automocion

Steering and Drive

Control Systems
Dura
JTEKT Corporation
TRW Automotive

Avon Automotive
Gumarny Zubri
Hutchinson
Kautex -Textron
Plakor Czech (ARRK)
Saar Gummi
ZPV

Infotainment solutions
Continental
Kyocera Display
Panasonic Automotive
Systems
TVM Acoustics

Bosal
Donaldson
Eberspcher International
Faurecia Exhaust Systems
Karsit
Mann+Hummel
Monroe Tenneco
Tyll
Witzenmann

Exterior

AGC
Aoyama
CIE Automotive
Duve
Essa - Grupo
Estampaciones Sabadell
Futaba
Key Plastics
Klein&Blaek
Kovovyroba Hoffmann
Magna International
Massag
Plakor Czech (ARRK)
s. n. o. p.
Saint-Gobain Sekurit
Sungwoo Hitech
Tawesco
Tiberina Automotive Bl
Tokoz
Zeveta

Interior

EuWe Eugen Wexler Int.

Faurecia Interior Systems
Bohemia
Gruppo Antolin
Gumarny Zubri
Gumotex
Hyundai Mobis
Inteva Products
Key Plastics

Seatings

Brose
Car Trim
Commercial Vehicle Group
Dymos
Faurecia
Fehrer Bohemia
Fezko Thierry (Johnson

Wheels & Tyres

Barum Continental
Hayes Lemmerz Alukola
Mitas
Ronal CZ

suppliers are based in the Czech Republic?

Moravian-Silesian Automotive Cluster
The Moravian-Silesian Automotive Cluster supports innovation
and enhancement of the competitive advantage and export ability of its 62 members in the Moravian-Silesian region. It helps to
develop the automotive industry in the region through strong industrial enterprises, universities,
research institutions and other organizations, in both the private and public sectors.
The cluster also contributes to the enhancement of permanent competitiveness of regional
suppliers for the automotive industry in the Czech Republic as well as abroad and creates
conditions for increasing the technical capacity and utilisation of the local workforce.

www.autoklastr.cz

Automotive Industry Association

of the Czech Republic

The AIA is an industrial interest association of manufacturing, commercial

and other companies that make up the
automotive and related industries in
the Czech Republic.
Today the AIA covers most of the automotive sector with 145 members. The
associations main goals are focused
on the long-term deve-lopment of the
Czech automotive inustry, contribution to the competitiveness of Czech
automotive companies and support
of networking and mutual cooperation between its members and foreign
countries.
In addition to providing various statistical
information and consultancy services,
the AIA represents the common interests
of the sector in dealing with national
and international authorities.

www.autosap.cz

Automotive Supplier Database

CzechInvests database of automotive suppliers offers comprehensive information about automotive component
manufacturers in the Czech Republic. The database contains nearly 900 companies and its scope covers the Czech
Republics entire automotive supplier base, making it an exceptional tool for mapping the possibilities of this sector
in a given region. Other unique aspects are the division of suppliers into Tiers 1, 2 and 3 and useful display of
customers for each component produced by a given supplier. The database thus provides information on which
vehicle manufacturers the given components are intended for. These manufacturers include all global brands such as
VW, Daimler, Toyota, BMW, Ford, Volvo, Porsche, Audi, etc.

The database is available free of charge at

http://suppliers.czechinvest.org

Top Automotive R&D Location

My experience with Czech engineers

in automotive fields during my 25
years with GM and Chrysler R&D
in the US and Canada has been more
than excellent. They have a high level
of technical education, comprehensive
knowledge and understanding of
complicated technical issues and
excellent skills. Czech universities offer
a pool of engineering and management
talents for the global market.

George Strnad, Design Engineer, General

Motors Corporation

In the long term, the Czech Republic is one of the worlds most attractive automotive R&D
locations. This is due to the perfect blend of an outstanding engineering tradition, excellent
technical education and consistent attention to ongoing training of new, high-quality automotive
professionals.

Selected Technology and R&D Centres

PRAGUE
MBtech Bohemia
Porsche Engineering Services
Ricardo Prague
Valeo Systemes Thermiques
TV-SD Czech

LIBEREC REGION
Denso
Idiada CZ
TRW Automotive
MSV Systems CZ

HRADEC KRLOV REGION

Continental Teves
Swell

MORAVIAN-SILESIAN REGION
Behr Czech
Continental Automotive Systems
Hayes Lemmerz International
Varroc Lighting Systems

LIBEREC
USTI NAD LABEM

CENTRAL
BOHEMIA REGION
AUFEER DESIGN
Behr Czech
Faurecia
Idiada CZ
Ingersoll Rand
Kostal CR
MBtech Bohemia
Swell
koda Auto

PRAGUE

KARLOVY VARY

OLOMOUC REGION
HELLA KG Hueck&Co.
Horiba

HRADEC KRALOVE

PARDUBICE

PLZEN

OLOMOUC

JIHLAVA

OSTRAVA

ZLIN

CESKE BUDEJOVICE

PLZE REGION
MBtech Bohemia
NARETEC
ZF Engineering

BRNO

SOUTH BOHEMIA REGION

Robert Bosch
Z a.s.
MOSLED
TRW-DAS
Brisk

ZLN REGION
Nippon Kayaku
VYSOINA REGION
Bosch Diesel
Mann+Hummel
Motorpal

SOUTH MORAVIA REGION

Blata
Honeywell Turbo Technologies
Mann+Hummel

Source: CzechInvest 2015

Czech Technical Univeristies and Their Automotive Partners

Czech Technical
University in Prague

Technical University
of Liberec

University of West
Bohemia, Pilsen

Brno University
of Technology

VB Technical
University of Ostrava

TRW Automotive
koda Auto
Porsche Engineering
Honeywell
Siemens
Bosch
Brano
Tatra
www.cvut.cz

koda Auto
MAN
Audi
Daimler
Bosch
Continental
Magna
Saint-Gobain
TRW Automotive
www.tul.cz

Volkswagen AG
Valeo
koda Auto
Bosch
MBtech Bohemia
ABB
ZF Friedrichshafen
www.zcu.cz

koda Auto
TRW Automotive
Tatra
Volkswagen
Honeywell
Magna Powertrain
Motropal
www.vutbr.cz

koda Auto
Brose
Continental
Hayes Lemmerz
Honeywell
Varroc Lighting
www.vsb.cz

Selected Czech-Based Technology Centres

MBtech Bohemia
MBtech Bohemia is based in three locations in Plze, Prague and Mlad Boleslav as a subsidiary
of MBtech Group, a global provider of automotive engineering and consulting services.
The Czech R&D centres specialize in CAD design of components and modules for new vehicles,
engines and electronics. The scope of services ranges from concepts including Class A Design,
engineering services, production of prototype parts and model building, as well as complete
vehicle testing. MBtech Bohemia in the Czech Republic is the biggest foreign subsidiary
of MBtech Group worldwide.

Ricardo Prague
Ricardo Consulting Engineers UK operated in the Czech Republic from 2000 until Ricardo
Prague Ltd. was established in 2005. Prague Technical Centre cooperates daily with other
members in the UK, USA, Germany, Italy, Japan, China and India Ricardo locations, and others
to provide CAE design and analysis support to satisfy customers around the world. Prague
Technical Centre offers research and development and design support mainly in the field
of internal combustion engines, transmissions, vehicle technology and Control&Electronics.
The current number of 160 engineers is a consequence of the interrupted growth during
the crisis period. Ricardo Prague undertook a major expansion of its technology centre
in the Czech Republic in 2004 and has been growing recently again.

Swell Technology Centre

At its Development Services Centre in Hoice, Czech Republic, the engineering company
SWELL operates a progressive technology centre for comprehensive development support
in the automotive industry. The scope of services covers CAD/CAE engineering and prototyping,
mainly in the sheet-metal area (BIW structures), and a wide range of development testing (vibration
tests at high temperatures for engines and exhaust-system components, frequency and modal
analyses, combined mechanical/environmental testing for plastic and metal structures, etc.).
The companys customers include koda Auto, Honeywell Turbo Technologies, Continental
Automotive Systems, Faurecia Exhaust Systems, Magna International, and many others.

Valeo Climate Control

Valeo Climate Control has a technology centre in Prague to provide engineering support
for its heating, ventilation and air-conditioning (HVAC) and control panel programmes.
As it is engaged in all new development projects, the Czech R&D centre cooperates
with nearly all Valeo climate control divisions elsewhere in the world. As a state-of-the-art
yet cost-effective development location, Valeos Czech R&D centre is considered a centre
of excellence for air-conditioning system design.

Varroc Lighting Syst

Systems
s ems
s
Varroc Lighting Sy
Systems,
ystems,
ste
te
a who
wholly-owned
h lly-o
owned
ow
ed
d en
e
entity
ntity o
off the
the
e Var
Va
Varroc
roc
ro
oc Gr
Group,
roup
up, iiss a leadi
leading
d ng Tier 1 gl
g
global
obal
automotive supplier sspecializing
pec
pe
e ializing in Res
Research
esear
esear
e ch
ch & Developmentt a
and
nd ma
man
manufacturing
a ufac
ufa
ufa
fact
ct ring of exte
ctu
exterior
erio
rriior llighting
ighting
products suc
such
ch a
as
s head
headlamps,
dlamps,
la
lam
a ps,
am
ps si
ssignal
gnal lamps, auxiliary lamps, projector sys
systems,
stem
te
e s,
s, and
nd
d electronic
c
control modules.
modules
les
ess Varroc
es.
Varrroc
oc Lighting
Light
Lig
htting Systems is registered in the Netherlands,
Netherland
dss,, headquartered
headqu
headqu
hea
dquartere
ed in
in
Plymouth, Michigan, USA,
USA,
SA
S
A and
an
nd operates
operates in Asia, Europe and North America,
Ameri
errica,
ca
a, with
with
wi
th nearly
ne rly 5000
nea
employees.
employ
yees
ee . T
The
he Varroc Group completed the acquisition of the global lighting division of Visteon
Corporation on
on the
he 1st of August 2012 and now presents its brand as Varroc Lighting Systems.
Syystems.
Sys
S
tems
tem
In the
h Czech
h Repub
R
Re
Republic,
epub
p lic, Varroc Lighting Systems operates two plants, a tool factory and
pu
dag
global
lob
lob
loba
bal
development
develo
opm
pm nt centre. With more than 2,300 employees Varroc Lighting Systems is one of the
pme
major employers in the Moravian-Silesian Region and the Czech Republic.

10
0

Education and Workforce

The Czech Republic offers high-level technical education at several technical universities
evenly distributed across the country. The country has more than 90,000 university students
majoring in technical or science-related programmes. More than 20,000 graduates enter the
workforce every year and the number of technical graduates increase every year.

Number of Students and Graduates

Czech Universities
Automotive Related Programmes
Academic year 2013/2014
Region
Prague

Students

Graduates

5,420

1,106

Central Bohemia

30

South Bohemia

1,184

190

Plzen
Karlovy Vary
Usti
Liberec

642

79

1,457

279

Hradec Kralove
Pardubice
Vysocina
South Moravia

0
150

1,693

301

Olomouc
Zlin
Moravia-Silesia
Total

0
981

41

36

578

125

939

298

12,958

2,570

Apart from universities, the Czech educational system features other sources of skilled
labour, including specialised four-year higher professional schools whose students graduate
with the near equivalent of a university bachelors degree.

Technical Students and Graduates from Czech Universities 2013/2014

Source: Ministry of Education, Youth and Sport, 2014

Note: According to the selected study programmes source CzechInvest. Complete ICT included.
Source: Ministry of Education, Youth and Sport, 2014

Number of Students and Graduates

Higher Professional Schools, Secondary Specialized
Schools and Vocational Training Centres
Automotive Related Programmes
Academic year 2013/14
Region

Students

Graduates

Prague

1,986

397

Central Bohemia

2,576

692

South Bohemia

2,144

563

Plzen

1,363

402

Karlovy Vary

626

131

Usti

1,656

346

Liberec

1,117

229

Hradec Kralove

1,483

386

Pardubice

1,585

394

Vysocina

1,626

395

South Moravia

3,157

736

Olomouc

1,905

422

Zlin

1,368

389

Moravia-Silesia

3,390

776

25,982

6,258

Total

Source: Ministry of Education, Youth and Sport, 2014

Technical Universities 2013/2014

Czech Republic
Technical Students Total
Students: 94,579
Graduates: 20,573
PhD graduates: 8,238

LIBEREC

PRAGUE
PARDUBICE

PLZEN

OSTRAVA

ZLIN
BRNO

Czech Technical University in Prague

Students: 20,066
Graduates: 4, 704
PhD graduates: 1,953
Charles University Prague
Students: 2,568
Graduates: 563
PhD graduates: 692
Institute
of Chemical Technology Prague
Students: 4,381
Graduates: 754
PhD graduates: 812
Source: Ministry of Education, Youth and Sport, 2014

Technical University
of Liberec
Students: 3,238
Graduates: 608
PhD graduates: 316

University of West Bohemia

Plzen
Students: 4,421
Graduates: 886
PhD graduates: 538

University of Pardubice
Students: 5,385
Graduates: 934
PhD graduates: 406

Brno University of Technology

Students: 18,235
Graduates: 4,444
PhD graduates: 1,671

Technical University of Ostrava

Students: 14,264
Graduates: 3,340
PhD graduates: 1,198

Tomas Bata University Zlin

Students: 3,466
Graduates: 920
PhD graduates: 268

11
1
1

Labour Market

There are three reasons to utilise

the Czech workforce. The first reason
is low labour costs, which are
significantly lower in comparison
with Western Europe. The second
reason is Czech workforces high level
of qualifications, which is confirmed
by the number of Czech employees
who work for Bosch worldwide in
managerial positions and on specific
tasks. The third reason is the high
degree of flexibility of employees,
who are able to accept new
challenges and new projects
and are highly mobile.

Milan lachta,
Commercial Manager, Robert Bosch

Labour costs in the Czech private sector stand at 45% of the EU-27 average. Nevertheless,
the main benefit of the Czech Republic consists in the excellent cost-quality ratio of the
countrys highly educated and skilled workforce. This is especially relevant within the comparison
to other CEE countries.
According to Eurostats data from 2013, the Czech Republics labour costs remain very
competitive in the EU. The Czech Republic can offer average labour-cost savings of 40%
to 60% in comparison with costs in Western Europe or the United States For instance,
in 2013 the Czech hourly wage in the manufacturing sector was EUR 10 as compared to EUR
36.20 in Germany, EUR 36.70 in France and EUR 22 in the United Kingdom.

Gross Monthly Wages (median) in the Automotive Sector, 2013

Position

CZK/month

EUR/month

Total labour costs*

Mechanical engineers

40,602

1,480

1,983

Mechanical engineering technicians

29,114

1,061

1,422

Welders and flame cutters

23,840

869

1,164

Sheet-metal workers

23,046

840

1,125

Electrical mechanics and fitters

24,265

884

1,185
998

Motor vehicle mechanics and repairers

20,433

745

Assemblers

18,956

691

926

Mechanical-machinery assemblers

21,386

779

1,044

Manufacturing labourers

15,623

569

763

*Total labour costs include employers insurance contributions (34%).

Average Exchange Rate 1 EUR=27.441 CZK (average for Q1 2014, Czech National Bank 2014)
Source: Ministry of Labour and Social Affairs, 2014

Business Legislation

The average wage

in the Czech Republic
is 30% of that
in Germany.

Foreign legal entities are allowed to conduct business activities, including acquisition
of real estate, under the same conditions and to the same extent as Czech businesses.
They may become founders or co-founders of a company, or may join an existing Czech
company.
Foreign companies may operate in the Czech Republic, either by establishing a branch
office registered in the Czech Republic or by establishing a Czech company. There are four
different legal forms of companies; the most common are limited liability companies (s.r.o.)
and joint-stock companies (a.s.). The trade name of a company must be unique.
Such business entities may employ either Czech citizens or foreign citizens, who are subject
to registration, visa and other requirements. Residency and green-card systems are available
for key foreign employees. In addition to the choice of investment in corporate, non-corporate
and EEC specific entities, investors enjoy the a
dvantag
ge of an adv
ge
d anced (judicial and non-judicial)
dv
advantage
advanced
legal and dispute resolution system,
em,
m, anti-tru
rust
ru
u protec
ection and
ec
nd
d the um
mbre
br lla of EU protective
anti-trust
protection
umbrella
regulation.

12

Financial Support
Between 1998 and
2014, 924 projects
were supported with
investment incentives.
The total investment
amount reached

EUR 24.3 billion.

In addition to proximity to manufacturing

facilities, the government incentives
programme for new technology centres
was key to Honeywells decision.
We are very pleased with the support
CzechInvest is providing.

Dan Sheflin, Vice-President and Chief

Technology Officer of the Automation and
Control Solutions, Honeywell

The Czech Republic offers both new and existing investors support covering up to 25%
of costs associated with investment projects. Aid is provided mainly from the national
investment incentives scheme; specific activities such as establishment of R&D centres,
establishment of training centres, energy savings, renovation of buildings, etc. cen be also
supported from EU structural funds.

Investment Incentives
Investment incentives are offered for implementation of new projects or expansion of existing
projects in the areas of:
-- Manufacturing
-- Technology/R&D centres
-- Centres of business support services shared service centres, software-development
centres, high-tech repair centres, data centres, call centres
Aid is provided in all regions, with the exception of Prague, pursuant to the Act on Investment
Incentives and consists of the following incentives:

Forms of Incentives
Corporate tax incentive

Full corporate tax relief for up to ten years for new companies
Partial tax relief for up to ten years for existing companies

Real estate tax incentive

Exemption from real estate tax in selected regions for up to five years

Job-creation grants

Financial support for creation of new jobs in selected regions

(up to EUR 11,000 per new job)

Training and retraining grants

Financial support for training and retraining of new employees

in selected regions (up to 50% of eligible training costs)

Cash grants for capital investment

Available for large strategic investment projects (see the details below)

Source: Investment Incentives Act Amendment of 2015

Specific Conditions of Strategic Investment

Production

Technology
centre

EUR 20
million*

EUR 8
million*

Eligibility Criteria
Manufacturing

Technology centres

Centres of business support services

Minimum investment
of EUR 0.4 million;
at least 50% of the eligible
costs must be expended
on new machinery

No conditions regarding minimum

investment

Creation of at least
20 new jobs

Creation of at least 20 new jobs at data

centres and software-development centres;
at least 70 new jobs at shared service
centres and repair centres; at least 500 new
jobs in call centres

New jobs created

500+

100+

Minimum investment of EUR 2-4

million depending on the regions
rate of unemployment; at least 50%
of the eligible costs must expended
on new machinery

Maximum grant
for capital investment

EUR 60
million

EUR 20
million

Creation of at least
20 new jobs

Minimum investment
in long-term tangible
and intangible assets

*of which at least half must be invested in machinery

No works may be started on the project prior to the application for incentives is submitted to CzechInvest
Source: Investment Incentives Act Amendment of 2015

Introduction of the institution of Strategic Investment

Besides other investment incentives, strategic investments can receive a grant for capital
investment in the amount of up to 10% of eligible costs, respectively up to 12,5% of eligible costs
if the investment into production occurs simultaneously with the establishment or expansion
of a technology centre. The total maximum state aid intensity shall henceforth be governed
by the Regional Map of the Czech Republic.

CzechInvests Services

Headquartered in Prague, CzechInvest is the Investment and Business Development

Agency of the Ministry of Industry and Trade. Since its establishment in 1992, the agency
has been tasked with attracting foreign investments and developing domestic companies
through its services and development programmes.

Our Objectives
-----

To advise and support existing and new companies to grow and prosper in the Czech
Republic
To facilitate communication between the public and private sectors
To actively influence the positive development of the business environment
To support the competitiveness of the Czech economy

CzechInvest is exclusively authorised to file applications for investment incentives

at the relevant governing bodies and prepares draft offers to grant investment incentives.
Its task is also to provide potential investors with current data and information on the
business climate, investment environment and investment opportunities in the Czech
Republic.

Our Services
----------

Detailed, sector-specific market intelligence and value propositions

Customised business cases
Identification of business properties and sites suitable for investment
Tailored visits to the Czech Republic
Access to investment incentives and EU funds
Information and advice on doing business in the Czech Republic, regulations
and taxation
Identification of potential business partners, suppliers and acquisition targets
Referrals to professional associations (lawyers, bankers, accountants, etc.)
Aftercare service

Our services are fully funded by the Ministry of Industry and Trade as a part of the business
support measures so they are free of charge to businesses.

OEMs and Selected Tier-1 Supliers in the Czech Republic

CZECHINVEST HEADQUARTERS

CZECHINVEST WORLDWIDE

CZECH REPUBLIC
Stepanska 15
120 00 Prague 2

GERMANY
PHONE: +49 211 250 56 190
E-MAIL: germany@czechinvest.org

+420 296 342 513

automotive@czechinvest.org
WEB: www.czechinvest.org

CHINA SHANGHAI
MOBILE: +86 13817792614
E-MAIL: china@czechinvest.org

PHONE:
E-MAIL:

UK
+44 20 7221 9663
MOBILE: +44 77 8523 1520
E-MAIL: london@czechinvest.org
PHONE:

SCANDINAVIA
+420 296 342 540
+358 415 787 432
E-MAIL: scandinavia@czechinvest.org
PHONE:

www.czechinvest.org

USA WEST
+1 (415) 794 0665
E-MAIL: california@czechinvest.org
MOBILE:

JAPAN
PHONE:
E-MAIL:

+81 3-5485-8266
tokyo@czechinvest.org

USA EAST
+1 347 216 93 55
E-MAIL: newyork@czechinvest.org
MOBILE:

KOREA SEOUL
+82 10 2987 5632
E-MAIL: seoul@czechinvest.org
PHONE:

This material is distributed free of charge.

Date of issue: February 2015