Mechanical and Electrical Engineering
in Slovakia.
October 2012
osec.ch
Mechanical and Electrical Engineering
in Slovakia.
Month and year:
October 2012
Language:
English
Number of pages:
73 pages
Author:
2
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Osec (www.osec.ch) in cooperation with MARKETiN CEE s.r.o.
(www.marketincee.com)
Table of Contents
1
Executive Summary.....................................................................................................................................6
2
Economy and Business Environment .......................................................................................................8
2.1
2.2
2.3
Current Economic Situation ............................................................................................................................................................. 8
Business Environment ................................................................................................................................................................... 12
Direct Investment Support .............................................................................................................................................................. 20
3
Mechanical and Electrical Engineering ...................................................................................................26
3.1
3.2
3.3
Role and Development of MEM Industries ..................................................................................................................................... 26
Mechanical Engineering ................................................................................................................................................................. 28
Electrical Engineering .................................................................................................................................................................... 44
4
Opportunities in Selected MEM Branches .............................................................................................. 61
4.1
4.2
4.3
4.4
4.5
4.6
Machine Tools and Manufacturing Technology ............................................................................................................................... 61
Textile Machinery ........................................................................................................................................................................... 62
Plastic Machinery ........................................................................................................................................................................... 63
Precision Tools ............................................................................................................................................................................... 64
Packaging Technology ................................................................................................................................................................... 65
Environmental Technology ............................................................................................................................................................. 66
5
Regulatory and Institutional Background ............................................................................................... 68
5.1
5.2
Regulations & Regulatory Authorities ............................................................................................................................................. 68
Professional organizations ............................................................................................................................................................. 68
6
Conclusions & Recommendations ..........................................................................................................70
List of Tables
TABLE 1
TABLE 2
TABLE 3
TABLE 4
TABLE 5
TABLE 6
TABLE 7
TABLE 8
TABLE 9
TABLE 10
TABLE 11
TABLE 12
TABLE 13
TABLE 14
TABLE 15
TABLE 16
TABLE 17
TABLE 18
TABLE 19
TABLE 20
TABLE 21
TABLE 22
TABLE 23
TABLE 24
TABLE 25
TABLE 26
TABLE 27
TABLE 28
TABLE 29
TABLE 30
TABLE 31
TABLE 32
TABLE 33
TABLE 34
TABLE 35
TABLE 36
TABLE 37
TABLE 38
TABLE 39
TABLE 40
TABLE 41
TABLE 42
TABLE 43
TABLE 44
TABLE 45
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Foreign trade development 2010 - 2012......................................................................................................................... 11
Doing Business ranking of Slovakia, Hungary and the Czech Republic in individual topics ............................................ 13
Summary of procedures for starting a business in Slovakia (standardized company) .................................................... 14
Summary of procedures for dealing with construction permits in Slovakia ..................................................................... 15
Summary of procedures for getting electricity in Slovakia .............................................................................................. 16
Summary of procedures for registering of property ........................................................................................................ 16
Getting credit index ........................................................................................................................................................ 16
Protecting investors index .............................................................................................................................................. 17
Evaluation of paying taxes ............................................................................................................................................. 17
Summary of export and import procedures .................................................................................................................... 18
Overview of main investors ............................................................................................................................................ 20
Inward foreign direct investments (FDI) in year 2010 (in thousands EUR) ..................................................................... 21
Inward FDI according to sectors in year 2010 (in thousands EUR) ................................................................................ 21
Inward FDI according to NACE in year 2010 (in thousands EUR) .................................................................................. 22
Inward FDI in year 2011 (in thousands EUR) ................................................................................................................. 22
Inward FDI according to sectors in year 2011 (in thousands EUR) ................................................................................. 23
Inward FDI according to NACE in year 2011 (in thousands EUR) .................................................................................. 23
Investment conditions ..................................................................................................................................................... 25
Slovak Industry............................................................................................................................................................... 26
Review of selected indicators of MEM Industries ........................................................................................................... 27
Turnover for own performances and goods of selected MEM industries in 2012 ............................................................ 27
Turnover for own performances and goods of selected MEM industries in 2010/11 ....................................................... 28
Mechanical Industry ....................................................................................................................................................... 28
Slovak Mechanical Industry ............................................................................................................................................ 29
Manufacture of machinery and equipment (C28) – Basic indicators ............................................................................... 29
Share of mechanical industry divisions on production of revenues ................................................................................. 29
Turnover for own performances and goods of mechanical industry in 2012 ................................................................... 30
Turnover for own performances and goods of mechanical industry in 2010/11............................................................... 30
Machinery & Equipment (C 28) – Export and import data ............................................................................................... 30
Share of mechanical industry divisions on employment ................................................................................................. 31
Employment and production of revenues within Machinery & Equipment (C28) ............................................................. 31
Investments according to divisions ................................................................................................................................. 31
Expenses on research and development according to divisions ..................................................................................... 32
Employees in research and development in divisions of mechanical industry ................................................................ 32
TOP 38 Manufacturers of machinery and equipment (C28) ............................................................................................ 34
Basic indicators of the Electrical Engineering sector in period 2008-2010 ...................................................................... 44
Manufacture of computer, electronic and optical products (C26) – Basic indicators ....................................................... 44
Manufacture of electrical equipment (C27) – Basic indicators ........................................................................................ 45
Share of electrical engineering industry divisions on production of revenues ................................................................. 45
Turnover for performances and goods in year 2012 (C 26, C 27) ................................................................................... 45
Turnover for performances and goods in 2010 and 2012 (C26, C27) ............................................................................. 46
Export and import of computer, electronic & optical products (C26) ............................................................................... 46
Export and import of electrical equipment (C27) ............................................................................................................. 46
Share of electrical engineering industry divisions on employment .................................................................................. 47
Employment and production of revenues within C 26 division in 2010 ........................................................................... 47
TABLE 46
TABLE 47
TABLE 48
TABLE 49
TABLE 50
TABLE 51
TABLE 52
TABLE 53
TABLE 54
TABLE 55
TABLE 56
TABLE 57
TABLE 58
TABLE 59
TABLE 60
TABLE 61
Employment and production of revenues within C 27 division in 2010 ........................................................................... 47
Investments according to electrical engineering divisions .............................................................................................. 47
Expenses on research and development in a relation to Slovak economy ..................................................................... 48
Number of employees in research and development in a relation to Slovak economy ................................................... 48
Man-hours of employees in research and development in a relation to Slovak economy ............................................... 48
Expenses on research and development according to divisions ..................................................................................... 48
Number of employees in research and development according to divisions ................................................................... 48
Man-hours of employees in research and development according to divisions .............................................................. 49
TOP 30 producers from electrical engineering sector ( C26 and C27) ............................................................................ 50
Import and export of metal forming machinery (C28.41) ................................................................................................. 61
Import and export of metal forming machinery (C28.49) ................................................................................................. 61
Import and export of machinery for textile, apparel and leather production .................................................................... 63
Import and export of plastic and rubber machinery ......................................................................................................... 64
Import and export of other special-purpose machinery ................................................................................................... 65
Import and export of optical instruments and photographic instruments ......................................................................... 65
Import and export of other special-purpose machinery (C28.29) .................................................................................... 65
List of Figures
FIGURE 1
Foreign Trade Balance ................................................................................................................................................... 11
1 Executive Summary
 The small and open economies of central Europe are facing increasing difficulties due to economic gloom spreading from western
Europe, but while both Hungary and the Czech Republic are being now in recession, Slovakia is powering ahead, enjoying one of the
strongest recoveries in the region.
 The GDP growth in the country is primarily driven by export, investments and the outperformance of Mechanical and Electrical Engineering industries (especially automotive industry and production of electrical equipment).
 By January 2012, the country´s ratings were as follows: A from Standard & Poor´s, A2 from Moody´s and A+ from Fitch Ratings.
 Slovakia is recognized as an open market economy with OECD country risk 0 and adopted EUR currency from 1st of January 2009. In
Worlds Bank The Doing Business ranking the country reached 48 points in 2012.
 The country has a strategic geographic location in central Europe which represents a great export and transit country potential. The
infrastructure is steadily developing, there are industrial parks and storages available for purchase or rent therefore Slovakia represents an ideal investment destination.
 The main industries moving to Slovakia are automotive, electrical equipment, machinery, steel and construction-related industries.
Slovakia has already attracted numerous western European, American (USA) and Asian investors, including Swiss companies such
as Vetropack or Schindler.
 At the beginning of the year 2012 Slovakia altered its investment incentive policy, the main changes include preference of sectors with
higher added value, investing in regions with higher unemployment and reduction of the minimal investment level.
 Mechanical and Electrical Engineering industries have a long tradition in Slovakia. They are the two leading sectors of the industry in
general and the two essential pillars of Slovak economy. After being negatively influenced by the global financial and economic crisis,
they started to revive and develop again from 2010 on.
 In mechanical industry sector is the dominant division manufacture of motor vehicles, trailers and semi-trailers which produces over
70% of revenues within the sector and also most of foreign investments are directed here.
 While the future challenges of mechanical industry sector include for example the strengthening competition of emerging countries,
lowering of production costs, changes in distribution chain structure or shortening of innovation cycles, the main opportunities are research and development, orientation on production of more sophisticated products and production of components for automotive industry.
 Electrical engineering sector used to be considered as a sector without a further development potential in Slovakia, but after the year
2000 it experienced (mainly thanks to foreign investments) a rapid growth and development. The dominant division within it is manufacture of computer, electronic and optical products.
 While the future challenges of electrical engineering industry are identical with the ones of mechanical industry, the market opportunities include producing of components for the gradually developing automotive industry, building up of customer service centres and
logistic centres, and relocation of consulting IT companies to Slovakia.
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 Production of machinery tools and manufacturing technology has a long tradition in Slovakia, but it was negatively influenced by introducing of open-market economy in 1989 (especially by losing the traditional export markets in other communist countries). There are
not many players present in this sub-division and compared to year 2008, all following years brought a decrease in revenues, employment et cetera.
 The long-term trend in production of machinery tools and manufacturing technology is that import performs better than export. One of
the main reasons is that foreign investors prefer to import tools and technologies according their choice from abroad rather than to
purchase them from the local producers.
 Production of textile machinery is closely connected with the textile industry, which experienced its last boom in the period from 1993
to 1997. Since then the textile industry was descending, being unable to compete with cheap production imported from Asia and due
to the loss of the traditional export markets. This has a negative impact also on production of textile machinery.
 There are only few players present in this sub-division, the production is rather low and there are basically no research and development activities going on.
 Production of plastic machinery started to develop more significantly in 70´s and 80´s of last century and it also suffered from the
change of closed economy to an open one.
 There are around 1000 small companies which own only one or two machines producing plastic products plus few large players which
produce and deliver plastic components for mechanical engineering industry (mainly for automotive industry), electrical engineering
industry and construction industry.
 Production of precision tools has always been limited in Slovakia. Nowadays there are only few companies present in this subdivision, mostly small-size, Slovak owned enterprises.
 Import numbers are nearly double of export numbers in the sub-division of precision tools due to import of production of well-known
foreign producers such as Sartorius Mechatronics, Mettler-Toledo or HBM.
 Similar as in the case of precision tools, the manufacturing of packaging technology is not large, although the production of packaging
materials is quite developed and diverse. But foreign investors who belong among the leading players in this sector mostly prefer to
use packaging technology imported from abroad.
 The quality of the environment has a decreasing tendency in general in Slovakia which is mainly a result of the fact that it is seen as a
low-priority area by politicians.
 The main issues in environmental area are proper implementation of EIA, protection of country and landscape, dealing with old environmental burdens and pollution, position of renewable energy sources in energy sector and waste management.
 Especially in the area of waste management the problem of Slovakia is a high number of communal waste storages, higher import of
waste than export, poor results of waste recycling, insufficient capacities for energy recovery of communal waste and using of old and
ineffective technologies.
2 Economy and Business Environment
2.1 Current Economic Situation
The small and open economies of central Europe are facing increasing difficulties due to economic gloom spreading from western Europe, resulting in both Hungary and the Czech Republic being now in recession. However, Slovakia, the smallest and most open of the
three countries, is powering ahead, enjoying one of the strongest recoveries in the region.
GDP growth (2.7% in 2.Q of 2012) has been driven mainly by exports, investment and the outperformance in car production and electrical
equipment production sectors. According to International Monetary Fund, the economy is expected to continue growing at a healthy pace.
Inflationary pressures are expected to ease – inflation spiked at 4.1% in 2011, driven by energy and commodity prices combined with an
increase in the standard VAT rate and in excise taxes introduced in January 2011. The core inflation stood at 2.7% in 2011. The HICP
inflation is set to ease to 2.9% by the end of 2012, due to the fading away of the increase of in indirect taxes and lower average increases
in administered prices for heating, gas, and electricity. The HICP inflation is expected to stabilize at around 2% in 2013.
Private consumption has remained subdued, being negatively influenced by the effect of fiscal consolidation and persistent high unemployment. According to OECD, Slovakia was placed among the nine EU countries which had a double-digit unemployment rate as of May
2012 (along with Estonia, France, Greece, Hungary, Ireland, Italy, Portugal and Spain). In 1.Q of 2012 million inhabitants of Slovakia were
employed which represents an increase of 0.6% against the same period of 2011. In 2.Q of 2012 employment in Slovakia grew by 0.2%
year-on-year to 2,216 million people. Boosting of employment is one of the top priorities of the new government (since March 2012),
effective implementation of the reformed Labor Code should help to reduce unemployment over the long run.
The new government is committed to reduce the fiscal deficit to below 3% of GDP by 2013, but a durable adjustment will require complementary reforms.
Slovakia in figures
 POPULATION: 5.405 million
 PUBLIC ADMINISTRATION STRUCTURE:




Regions: 8
Capital of Slovakia: Bratislava (465,000 inhabitants)
Other towns: 138
Villages: 2,891
Source: Statistical Office of the Slovak Republic (May 2012)
 OFFICIAL CURRENCY: Euro (abbreviation: EUR)
 MACRO-ECONOMIC INDICATORS:

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GDP (%)
o
4.2% in 2010
o
3.3% in 2011
o
3.0% in 1.Q 2012

Rate of registered unemployment (%)
o
14.4% in 2010
o
13.5% in 2011
o
13.2% in May 2012

Employment ESA 95 (year-on-year change in %)
o
-1.5% in 2010
o
1.8% in 2011
o
0,6% in 1.Q 2012

Balance of foreign trade (in million EUR)
o
778,4 in 2010
o
2,441.9 in 2011
o
2,042,7 in May 2012

Annual HICP inflation rate (average in %)
o
0,7% in 2010
o
4,1% in 2011
o
3,4% in May 2012

Annual CPI inflation rate (average in %)
o
1,0% in 2010
o
3,9% in 2011
o
3,4% in May 2012

Rating Standard & Poor´s
o
A+ in 2010
o
A+ in 2011
o
A in January 13, 2012

Rating Moody´s
o
A1 in 2010
o
A1 in 2011
o
A2 in January 13, 2012

Rating Fitch Ratings
o
A+ in 2010
o
A+ in 2011
o
A+ in 2012
Source: Selected economic and monetary indicators of the Slovak Republic – National Bank of Slovakia, European Central Bank, Ministry of
Finance of the Slovak Republic, Statistical Office of the SR, data available as at 11 July 2012

Industrial producer prices (%)
o
-2.8% in 2010
o
2.7% in 2011
o
4.0% in 2.Q 2012

Industrial production Index (%)
o
18.3% in 2010
o
7.2% in 2011
o
11.1% in 2.Q 2012

Total receipts of sectors (%)
o
7.9% in 2010
o
8.6% in 2011
o
5.0% in 2.Q 2012
Source: Statistical Office of the Slovak Republic, Ministry of Finance of the Slovak Republic, the European Commission, National Bank of Slovakia

Exports (goods and services, %)
o
16.5% in 2010
o
10.8% in 2011
o
3.1% in 2012
o
6.1% in 2013 (forecast)

Imports (goods and services, %)
o
16.3% in 2010
o
4.5% in 2011
o
2.7% in 2012
o
5.5% in 2013 (forecast)

General government gross debt (goods and services, %)
o
41.1% in 2010
o
43.3% in 2011
o
49.7% in 2012
o
53.5% in 2013 (forecast)
Source: Full forecasts for Slovakia - the European Commission, Eurostat
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 FOREIGN TRADE DEVELOPMENT
TABLE 1
Foreign trade development 2010 – 2012
2010
2011
change
Export in million EUR
48,271.1
56,407.9
16.9%
Import in million EUR
47,493.6
53,966.1
13.6%
778,5
2,441.9
1,663.4
Jan-May 2010
Jan-May 2011
change
Export in million EUR
22,882.5
25,122.9
9.8%
Import in million EUR
22,127.7
23,203.8
4.9%
754,8
1,919.1
1,164.3
Balance in million EUR
Balance in million EUR
Source: Ministry of Economy of the Slovak Republic
FIGURE 1
Foreign Trade Balance
Source: Volksbank
 LABOUR MARKET IN 1.Q 2012





Employment (in thousands persons): 2,324.7
Unemployment rate (%): 14.1%
Number of unemployed (in thousands persons): 380.3
Average number of employees (in thousands persons): 2,197.7
Average monthly wage of employee in economy (in EUR): 770
Source: INFOSTAT Bratislava
 PARTICIPATION IN INTERNATIONAL ORGANISATIONS






United Nations (since 1993)
NATO (since 2004)
EU (since 2004)
OECD (since 2000)
IMF (since 1993)
WTO (since 1995)
2.2 Business Environment
Slovakia represents a relatively new market, the industry and trade sectors make up a substantial part of business. Slovakia is generally
recognised as an open market economy with OECD Country risk 0.
During 2000-2006 period Slovakia gained the hallmark of a reform country due to public finance stabilisation, tax reform, labour market
reform, pension reform and public management reform. The reports helped to improve the business environment in Slovakia significantly
and helped Slovakia to successfully enter the European Union in 2004.
On 1st of January 2009, Slovakia adopted the EUR currency and became the 16 th member of the Euro Area (as the first Visegrad country). The official exchange rate has been set at 30.1260 SKK/EUR. As the membership in the euro zone reduces the currency exchange
risks and tightens the fiscal discipline of the adopting countries, it is also beneficial for business activities in Slovakia.
According to Doing Business 2012 report which compares 183 economies across the world, Slovakia and comparator economies rank on
the ease of doing business in a following way:
o
Slovakia
48
o
Hungary
51
o
Czech Republic
64
o
Regional average (OECD high income)
29
Doing Business 2012 rank: 48
Doing Business 2011 rank: 43
Change in rank: -5
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TABLE 2
Doing Business ranking of Slovakia, Hungary and the Czech Republic in individual topics
Slovakia
Hungary
Czech Rep.
Starting a business
76
39
138
Dealing with Construction Permits
50
55
68
Getting Electricity
102
103
148
Registering Property
10
43
34
Getting Credit
24
48
48
Protecting Investors
111
122
97
Paying Taxes
130
117
119
Trading Across Borders
95
74
70
Enforcing Contracts
71
19
78
Resolving Insolvency
35
66
33
In total
48
51
64
Source: Doing Business 2012, The International Bank for Reconstruction and Development / The World Bank
Starting a Business
The Slovak Commercial Code provides following options for structuring business entities:
o
Enterprise or branch office of a foreign company
o
Joint-stock company
o
Limited Liability company
o
Limited partnership
o
Co-operative
All business entities must be registered in the Slovak Commercial Register.
The most popular choice for foreign investors is to set up an enterprise, or branch office of a foreign company.
According to data collected by Doing Business, starting a business in Slovakia requires 6 procedures, takes 18 days, costs 1.8% of income per capita and requires paid-in minimum capital of 10.9% of income per capita.
TABLE 3
Summary of procedures for starting a business in Slovakia (standardized company)
No.
1.
2.
3.
Procedure
Time
Check the uniqneness of company name
1 day
EUR 3.00 for research in the
Commercial Register
1 day
EUR 1.99 for notary signature
Notarize articles of association and
related documents
Apply at the One-stop shop for trade
licenses, income tax registration and
1 week
health insurance company
Costs
EUR 5 or EUR 15 depending on type of
business activity
4.
Open a bank account
1 day
EUR 16.5
5.
Apply for registration at the District Court
7 days
EUR 165.75 if the application is
submitted
electronically, EUR 331.50 for hardcopy
6.
Register with pension, sickness, and dis-
1 day
no charge
ability insurance and unemployment
insurance at the local social insurance
company
Source: Doing Business 2012, The International Bank for Reconstruction and Development / The World Bank
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Dealing with Construction Permits
According to data collected by Doing Business, dealing with construction permits requires 11 procedures, takes 286 days and costs 7.2%
of income per capita.
TABLE 4
Summary of procedures for dealing with construction permits in Slovakia
No.
Procedure
1.
Obtain a certificate of ownership of the land
2.
Time
Costs
1 day
EUR 8
Apply for a Location Permit from the Municipal Authority
150 days
EUR 17
3.
Obtain the construction permit from the Municipal Authority
80 days
EUR 116
4.
Receive pre-construction, on-site inspection
1 day
no charge
26 days
EUR 332
26 days
EUR 204
7 days
no charge
7 days
no charge
29 days
EUR 66
Takes place simoultaneously with another procedure.
5.
Obtain consent from water and savage provider and
request water and savage connection
Takes place simoultaneously with another procedure.
6.
Obtain consent from telecommunications provider and
request telephone connection
Takes place simoultaneously with another procedure.
7.
Receive inspection and connection from water and
savage inspector
8.
Receive inspection and connection from telecommunications
provider
Takes place simoultaneously with another procedure.
9.
Obtain an occupancy permit from the Municipal Authority
10.
Receive on-site inspection from the Municipal Authority
1 day
no charge
18 days
EUR 115
Takes place simoultaneously with another procedure.
11.
Register the building with the Real Estate Registry
Source: Doing Business 2012, The International Bank for Reconstruction and Development / The World Bank
Getting Electricity
According to data collected by Doing Business, getting electricity requires 5 procedures, takes 177 days and costs 242.2% of income per
capita.
TABLE 5
Summary of procedures for getting electricity in Slovakia
No.
1.
Procedure
Apply for connection and await conclusion of the technical
study and sign Agreement for connection
2.
Await approval of the project design at electricity provider
Time
Costs
24 days
EUR 4,012.8
(calendar)
30 days
no charge
(calendar)
3.
Await completion of the external works carried out by the
109 days
electricity provider or electrical contractor
(calendar)
EUR
25,000.0
4.
Sign supply contract with electricity provider
7 days (cal.) no charge
5.
Await installation of the meter and electricity starts flowing
7 days (cal.) no charge
Source: Doing Business 2012, The International Bank for Reconstruction and Development / The World Bank
Registering Property
TABLE 6
Summary of procedures for registering of property
No.
1.
Procedure
Each party obtain extracts from the commercial register held
Time
1 day
by the respective court
2.
from EUR 0.33 to EUR 6.50
depending on form
Confirm the signature authencity of the seller before for
1 day
registration
3.
Costs
from EUR 0.50 to EUR 1.99
per signature
Submit the application for registration of the transfer proposal
for entry into the cadastro with the competent district land registry
15 to 30
days
from EUR 33 to EUR 130
depending on type of procedure
Source: Doing Business 2012, The International Bank for Reconstruction and Development / The World Bank
Getting Credit
TABLE 7
Getting credit index
Indicator
Slovakia
OECD
Strenght of local insight index
9
7
Depth of credit information index
4
5
Notes: Strength of Legal Rights Index represents a degree to which collateral and bankruptcy laws protect the rights of borrowers and lenders and
thus facilitate lending) - on a scale from 0 to10. Depth of credit information index measures rules and practices affecting the coverage, scope and
accessibility of credit information available through either a public credit registry or a private credit bureau - on a scale from 0 to 6.
Source: Doing Business 2012, The International Bank for Reconstruction and Development / The World Bank
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Protecting Investors
TABLE 8
Protecting investors index
Indicator
Slovakia
OECD
Extent of disclosure index (0-10)
3
6
Extent of director liability index (0-10)
4
5
Ease of shareholder suits index (0-10)
7
7
4,7
6
Strenght of investor protection index (0-10)
Source: Doing Business 2012, The International Bank for Reconstruction and Development / The World Bank
Paying Taxes
The Slovak tax system comprises the following taxes:
o
Income taxes (personal and corporate, the general tax rate of corporate income tax is 20% of the tax base)
o
Value Added Tax (VAT)
o
Excise duties
o
Real estate tax
o
Motor vehicles tax
o
Municipal taxes
o
Stamp duties
TABLE 9
Evaluation of paying taxes
Indicator
Slovakia
OECD
Payments (number per year)
31
13
Time (hours per year)
231
186
Profit tax (%)
7,2
15,4
Labour tax and contributions (%)
2
3,2
Other taxes (%)
2
3,2
48,8
42,7
Total tax rate (% profit)
Source: Doing Business 2012, The International Bank for Reconstruction and Development / The World Bank
Trading Across Borders
TABLE 10
Summary of export and import procedures
Export procedures
Time (days)
Cost (USD)
Documents preparation
7
235
Customs clearance and technical control
2
55
Ports and terminal handlings
2,1
11,1
Inland transportation and handlings
6,1
11,9
Totals
17
1560
Time (days)
Cost (USD)
Documents preparation
9
215
Customs clearance and technical control
2
55
Ports and terminal handlings
1,1
11,1
Inland transportation and handlings
5,1
11,9
Totals
17
1540
Import procedures
Source: Doing Business 2012, The International Bank for Reconstruction and Development / The World Bank
Transport and logistics
Due to its strategic geographic location in central Europe (Slovakia is referred to as the heart of Europe), Slovakia has a great export
potential, has a role of a crucial transit country linking different parts of Europe and its infrastructure is steadily developing.
Slovakia has around 400km of motorway and future development is under way (future construction will expand the motorway network to
701km). The Bratislava region in particular is well connected to the motorway infrastructure of neighbouring Czech Republic, Hungary
and Austria.
The total road network is about 17,500 km (with 3,300km of the first class roads, 3,700km of the second class roads and the rest is classified as 3rd class roads).
ŽSR (The Railways of the Slovak Republic) has 3,622km of railways, of which 2,603km are single-track and 1,019km are double-track.
There are 6 airports in the country - Bratislava Airport is the principal international gateway. Vienna Airport is only 50km away from Bratislava city and provides a wider network of available destinations.
The Danube river and the channel between the Rhone and the Danube connect Slovakia to the Black Sea and to the western European
system of waterways. The two main river ports are located in Bratislava and Komárno.
Slovakia improves its Economic Freedom Index
In September 2012, Slovakia claimed the 33rd place among the 144 monitored economies in the Economic Freedom Index prepared and
published by Economic Freedom Network. Slovakia´s rating reached 7.45 points from 10 possible. The Economic Freedom Index is using
the historical data and therefore reflecting the situation in the country back in 2010. Compared to year 2009, Slovakia improved its score
for 0.7 point and moved up from the 36th position on the index.
18
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Slovakia reached the best position in the area of monetary stability and for a freedom of international business, while the weakest points
are the regulations of business environment and the state size.
The business environment deteriorated in 1.Q of 2012
The business environment in Slovakia deteriorated over the first quarter of 2012, based on result from the Business Environment Index
prepared by the Slovak Business Alliance (PAS). The Business Environment Index is based on a survey of business, the figure for the
first quarter of the year stood at 85.1 points, which represents a drop of 2.24% compared to the last quarter of 2011.
The negative sentiments of businesses stems from considerable instability in legal rules and also the change of government (in March
2012) and concerns related to a potential rise in tax (from January 2012) and levy burden for particular businesses. The businesses are
mainly dissatisfied with the enforceability of law and the functioning of the judiciary. The judiciary is among the most heavily criticised
spheres over the long run due to imperfections in the sphere of law enforceability, slow court proceedings and murky practices).
Also the functionality of the political system was evaluated negatively due to the resignation of the previous government regarding proreform activities and its concentration mainly on pre-election topics. The goals declared by the new government in economic and financial
policy have stirred concerns as well.
In the first quarter of 2012, businesses were dissatisfied with the work of state institutions, effectiveness of the state´s economic performance, the state´s attitude to business aid, price stability, reliability and financial discipline of trade partners and red tape at offices. But
the business representatives praised the openness of businesses, investment and technological development as well as regulation of
cross-border trade.
Slovakia falls competitiveness ranking
According to the Global Competitive Report 2012-2013, published by the World Economic Forum (WEF), Slovakia ended 71st of 144
evaluated countries. The result is two places worse than last year and Slovakia fell in the list for the 6 th time in a row.
According to the Business Alliance of Slovakia (PAS), an employers´ lobbying group and a partner institution of WEF, the fall of Slovakia
in the list was caused by on-going barriers to business that the government - despite its declared statements - is not able to eliminate.
The main barriers to the county´s competitiveness include relatively ineffective public institutions, the high budget deficit, the low effectiveness of public expenditure, the low enforceability of laws, the low quality of the education system, an ineffective labour market, bureaucracy, corruption and cronyism.
On the other hand, Slovakia was praised for its openness to foreign ownership of companies, low custom barriers, laws supporting foreign investments and the technical forwardness of investors coming to Slovakia.
2.3 Direct Investment Support
Reasons for investing in Slovakia
The main reasons for investing in Slovakia include:
o
strategic geographic location in the central Europe
o
political and economic stability (including the using of the EUR currency and 20% flat tax rate)
o
predictable business environment
o
very few restrictions on foreign ownership and no limitation on the free flow of capital
o
steadily developing infrastructure
o
large selection of industrial land and offices available for purchase, rent etc.
o
low production and labour costs, availability of highly skilled workforce
o
simplified company set-up
o
raising number of satisfied foreign investors and volume of FDI in the country
o
governmental investment incentives
The main barriers for the arrival of foreign investors:
o
slightly worsening business environment
o
the decreasing quality of secondary schools and university graduates
o
red tape
o
an excessively long approval process for investment incentives (4 to 5 months)
Major foreign investors in Slovakia
The leading group of investors in FDI projects are from European countries, being followed by US companies and investors from Asian
countries. But this breakdown is inaccurate in a way, as some of US and Asian companies entered Slovak investment environment via
their European headquarters (which are registered in Germany, the Netherlands, Italy, etc.).
The main industries moving to Slovakia are automotive, electrical equipment, machinery, steel and construction-related industries.
TABLE 11
Overview of main investors
Country of origin
Name of investor
USA
US Steel, Emerson, DELL EMEA Centre of Excellence, Whirlpool, IBM International Services Centre, HP
European IT Operation Centre, Johnson Controls R&D Centre, AT&T Shared Services Centre,
Accenture Technology Solutions, Getrag Ford
Germany
Siemens, Volkswagen, T-Systems, Deutsche Telekom
Japan
Yazaki, Sumitomo, Panasonic, Sony
Korea
Samsung, KIA Motors, Hyundai Mobis
France
PSA Peugeot Citroen, Alcatel R&D
Spain
SOITRON
Switzerland
Vetropack, Schindler
20
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Inward foreign direct investments in 2010
TABLE 12
Inward foreign direct investments (FDI) in year 2010 (in thousands EUR)
2010
Total
-107,202
corporate sector
-20,502
banking sector
-86,7
According to countries
Austria
49,553
Belgium
7,495
Cyprus
85,537
Czech Republic
-52,022
Germany
66,548
France
9,63
United Kingdom
15,825
Switzerland
-17,313
Italy
14,161
Lichtenstein
2,196
Luxembourg
379
Netherlands
111,269
Total
-107,202
TABLE 13
Inward FDI according to sectors in year 2010 (in thousands EUR)
According to sectors
2010
B - Mining and quarrying
2,493
C - Manufacturing
196,142
D - Electricity, gas, steam
74,596
F - Construction
68,134
G - Wholesale and retail trade, repair of motor
12,148
vehicles
H - Transporting and storage
I - Accomodation and food services activities
J - Information and communication
K - Financial and insurance activities
92
-1,327
-307
-548,307
L - Real estate activities
26,837
M - Professional, scientific and technical activities
43,054
N - Administrative and support service activities
3,708
Total
-107,202
TABLE 14
Inward FDI according to NACE in year 2010 (in thousands EUR)
According to NACE Code/product sector
2010
C 25 - Manufacture of fabricated metal products, except machinery and equipmen
23,838
C 26 - Manufacture of computer, electronic and optical products
33,595
C 27 - Manufacture of electrical equipment
29,101
C 29 - Manufacture of motor vehicles, trailers and semi-trailers
8,845
Source: National Bank of Slovakia
Inward foreign direct investments in 2011
TABLE 15
Inward FDI in year 2011 (in thousands EUR)
2011
Total
845,906
corporate sector
526,404
banking sector
319,509
According to countries
Austria
1,525
Belgium
85,852
Cyprus
156,202
Czech Republic
276,219
Germany
136,521
France
7,595
United Kingdom
3,273
Hungary
12,667
Switzerland
-70,423
Italy
6,373
South Korea
828
Lichtenstein
15,482
Luxembourg
130,774
Netherlands
-16,172
Poland
Singapore
1,582
552
USA
69,711
British Virgin Islands
-3,823
Total
22
|
845,906
TABLE 16
Inward FDI according to sectors in year 2011 (in thousands EUR)
According to sectors
2010
C - Manufacturing
60,799
D - Electricity, gas, steam
118,445
F - Construction
-405
G - Wholesale and retail trade, repair of motor
14,508
vehicles
H - Transporting and storage
-1,327
I - Accomodation and food services activities
-1,327
K - Financial and insurance activities
343,500
L - Real estate activities
156,710
M - Professional, scientific and technical activities
131,277
N - Administrative and support service activities
Total
TABLE 17
5,704
845,906
Inward FDI according to NACE in year 2011 (in thousands EUR)
According to NACE Code/product sector
2011
C 25 - Manufacture of fabricated metal products, except machinery and equipment
486
C 27 - Manufacture of electrical equipment
6,522
C 29 - Manufacture of motor vehicles, trailers and semi-trailers
36,916
Source: National Bank of Slovakia
FOREIGN DIRECT INVESTMENTS IN YEAR 2012
According to National Bank of Slovakia, in 1.Q of 2012 Slovakia attracted foreign direct investments in a value of 771.2 million EUR (while
in 1.Q of 2011 it was only 309.3 million EUR).
In 2011, the total value of FDI reached 1.5 billion EUR.
In 2010, the total value of FDI reached 397 million EUR.
Important changes in Slovak investment incentive policy
At the beginning of year 2012, Slovakia altered its investment incentive policy. The main changes include:
o
o
o
o
Investment incentives granted to investors depend on the unemployment rate in the region in which the investor wants
to settle down.
The sectors of operation with a higher added value will be preferred.
The reduction of the required minimal investment level (which enables investment activities of smaller-sized and medium-sized enterprises to be supported, not only large-scale projects of big companies).
The prolonging of the duration of tax holidays.
Additional financial assistance available
o
o
o
banks(providing loans and overdraft facilities)
venture capital companies (direct investments into company with a view of a long-term investment)
invoice discounting/factoring suppliers (assisting with a company´s cash flow)
The Slovak Investment and Trade Development Agency (SARIO)
SARIO is a government-funded allowance organisation which works under the supervision of the Ministry of Economy of the Slovak Republic. The mission of SARIO is to promote growth and economic development, and to improve the quality of life in Slovakia.
Among its strategic objectives belongs applying an effective framework for the support of foreign investors and increasing the portion of
investors with high-value added production, and qualified and effective administration of EU Structural Funds, which provide support for
activities within the framework of Foreign Direct Investment and Foreign Trade (infrastructure development, intensification of international
cooperation, and image-building of the Slovak Republic).
The key activities include:
o
o
o
o
o
o
o
creating a suitable investment and business-friendly environment in Slovakia,
supporting investment projects of domestic and foreign investors and providing all necessary ancillary services,
providing consultancy and finding solutions regarding individual state aid to investors,
searching for and database-creation of available premises,
providing assistance as far as creation of joint-ventures between Slovak and foreign companies is concerned,
assisting small and medium sized enterprises in their search for export and trade opportunities abroad,
assisting local authorities, small, and medium sized enterprises with their application for EU Structural Funds’ Grants
(within the jurisdiction of SARIO) and helping them with the implementation of their projects.
Forms of investment projects and conditions
The Act on Investment Aid divides the projects which may be supported into four categories:
o
o
o
o
industrial production
technological centers
shared service centers
tourism
The common conditions for all categories are:
o
o
o
o
o
o
incentives are available for the launch of a new entity as well as for the extension of an existing one
at least 50% of the minimum investment must be covered by own equity of the investor
work on the project cannot start before the Ministry of Economy gives its preliminary consent with granting of the aid
the recipient of the aid can be only Slovak entity
the investment plan must be submitted in Slovak
there is no legal entitlement to receive investment incentive
Minimum amount of investment in industry depends on the unemployment rate in the proposed location.
24
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TABLE 18
Investment conditions
Minimum investment
The share of new
amount
tech. equipment
The amount that has to
be
covered by own entity
lower than Slovak average (<13.16%)
14 million EUR
60%
7 million EUR
higher than Slovak average (>13.16%)
7 million EUR
50%
3.5 million EUR
3.5 million EUR
40%
1.75 million EUR
Unemployment rate
at least by 50% higher than Slovak average (>19.74%)
Minimum 60%/50%/40% of eligible costs (according to the unemployment in the specific region) must be used for acquisition of new
machinery and equipment.
Minimum amount of investment in technological centers and shared service centers is independent from the unemployment rate in the
proposed location. The conditions are following:
Technological centers
o
minimum investment of 500 thousands EUR on the fixed assets
o
at least 250 thousands EUR must be covered by own equity
o
the company must employ at least 60% of employees having university education
Shared services centers
o
minimum investment of 400 thousands EUR on the fixed assets acquirement
o
at least 200 thousands EUR must be covered by own equity
o
the company must employ at least 30% of employees having university education
Forms of incentives
o
o
o
o
cash grant
partial tax relief
contribution to new jobs
transfer of the state/municipality property to the investor for a discounted price
Eligible costs
o
o
o
o
costs of land acquisition
costs of building acquisition
costs of technological equipment and machinery acquisition
intangible fixed assets – licenses, know-how, etc.
Detail information available at:
http://www.sario.sk/userfiles/file/Ensario/PZI/why/12_08_Invest_in_Slovakia.pdf
http://www.sario.sk/userfiles/file/sario/pzi/statna/Investment%20incentives.pdf
3 Mechanical and Electrical Engineering
3.1 Role and Development of MEM Industries
The mechanical and electrical engineering industries have and benefit from their long history in Slovakia. They are the leading sectors of
all industry and manufacturing in Slovakia and two of the essential pillars of Slovak economy. The MEM Industries (C 24 – C 30 divisions
according to classification of the European Statistical System) play a vital role within Slovak industry.
Slovak industry has been experiencing structural changes since the beginning of 90´s in the last century. Since 2008 the changes were
fueled primarily by global financial and economic crisis and its negative influence. The first signs of the influence of economic crisis on
Slovak economy and industry started to be visible in August 2008. The growth of industrial production subdued and slumped two months
later in October, hand in hand with a decline in demand for workforce. (While in the 2002-2008 the engineering industry experienced a
systematic growth in all areas/measured indicators).
The risk factors became mainly:
o
high openness of Slovak economy
o
dominant position of C29 division (manufacture of motor vehicles, trailers and semi-trailers) and electrical engineering
which are exceptionally sensitive to crisis events in economy
o
strong orientation on export markets of western Europe
o
unfavorable development of exchange rate of currencies of neighboring countries versus EUR currency (Czech Republic, Poland and Hungary)
TABLE 19
Slovak Industry
2008
2009
2010
Total revenues in million EUR
65630
53237
61611
Value added in million EUR
11969
10722
11503
After-tax profit in million EUR
2904
1722
2727
Average number of employees
437320
372310
361490
Average monthly wage in EUR
788
815
860
Note: Data for companies with 20 and more employees.
Source: Statistical Office of the Slovak Republic, TREND (economic weekly magazine)
26
|
TABLE 20
Review of selected indicators of MEM Industries
Revenues for own performances & goods in million EUR
1-2Q 2011
2010
2009
2008
2007
2006
2005
n/a
n/a
n/a
9035
8764
7155
5235
1508
2395
1831
3579
3514
3275
n/a
1-2Q 2011
2010
2009
2008
2007
2006
2005
Electrical Engineering Industry
n/a
n/a
n/a
211
233
223
221
Mechanical Industry
n/a
181
194
282
246
231
n/a
1-2Q 2011
2010
2009
2008
2007
2006
2005
n/a
n/a
n/a
72612
67680
63263
62232
33072
29759
30019
46040
44287
42685
n/a
1-2Q 2011
2010
2009
2008
2007
2006
2005
n/a
n/a
n/a
8783
8581
6986
5106
1526
2406
1768
3605
3563
3269
n/a
Electrical Engineering Industry
Mechanical Industry
Number of companies
Number of employees
Electrical Engineering Industry
Mechanical Industry
Production in total in million EUR
Electrical Engineering Industry
Mechanical Industry
Source: Ministry of Economy of the Slovak Republic
TABLE 21
Turnover for own performances and goods of selected MEM industries in 2012
Divisions of MEM Industries
January
February
March
April
May
June
July
C24+C25 - Basic Metals & Metal Products (mil. €)
772,4
785,8
840,2
800,2
862,9
850,8
845,6
C24+C25 - Basic Metals & Metal Products (index)
102,1
107,1
103,1
107,6
103,3
104,9
112,5
C26 - Computer, Electronic & Optical products (mil. €)
533,7
405,8
533,4
544,5
538,9
436,8
288,5
C26 - Computer, Electronic & Optical products (index)
127,1
98,7
110,7
93,8
108,8
110
120,6
C27 - Electrical Equipment (mil. €)
209,8
221,8
244,8
200,7
219,7
219,5
206,1
C27 - Electrical Equipment (index)
104,7
104
99,8
100,1
94,9
90,5
101,1
C28 - Machinery & Equipment (mil. €)
265
280,7
299,3
276,6
291,7
286,6
254,1
C28 - Machinery & Equipment (index)
106,9
107,2
95,2
102,7
99
102,9
104,6
C29+C30 - Motor Vehicles & Transport Equip. (mil. €)
1305,9
1695,7
1896,3
1769,6
1962,8
1951
1704,5
C29+C30 - Motor Vehicles & Transport Equip. (index)
111,5
128,1
130,2
134,9
133,7
126,7
154,5
Industrial production C10-C33 in total (in million €)
4958,7
5354,8
6018,5
5513,2
5866,6
5806,5
5400,5
Index
109,1
111,6
111,2
108
109,8
108,4
120
Source: Statistical Office of the Slovak Republic
TABLE 22
Turnover for own performances and goods of selected MEM industries in 2010/11
Divisions of MEM Industries
2011
2010
C24+C25 - Basic Metals & Metal Products (mil. €)
9407,6
8409,2
C24+C25 - Basic Metals & Metal Products (index)
106,4
124
C26 - Computer, Electronic & Optical products (mil. €)
6064,1
6816,1
C26 - Computer, Electronic & Optical products (index)
90,2
117,9
C27 - Electrical Equipment (mil. €)
2638,6
2364
C27 - Electrical Equipment (index)
109,6
117,9
C28 - Machinery & Equipment (mil. €)
3129,2
2630,6
C28 - Machinery & Equipment (index)
118,4
133,9
C29+C30 - Motor Vehicles & Transport Equip. (mil. €)
16984,9
13902,9
C29+C30 - Motor Vehicles & Transport Equip. (index)
126,5
138,3
62577,8
54716,4
110,8
120,9
Industrial production C10-C33 in total in million EUR
Index
Source: Statistical Office of the Slovak Republic
3.2 Mechanical Engineering
In 2010, C 28 division was the second biggest branch of mechanical industry from the point of view of production of revenues and employment (following the dominant C 29 division – production of motor vehicles, trailers and semi-trailers).
Compared to year 2008, there was a drop in both revenues and employment recorded in 2010. The revenues reached only 64% of the
volume in the year 2008, and the number of employed persons declined for 15.5 thousands persons. Productivity of work stagnated.
The positive moment was the development of value added (of productivity) and the value of indicator of value added. It was higher and
more dynamic than it was average in the whole mechanical industry.
TABLE 23
Mechanical Industry
2008
2009
2010
Total revenues in million EUR
19715
14281
18503
Value added in million EUR
2885
2417
2939
After-tax profit in million EUR
508
-152
386
Average number of employees
133443
106767
108299
Average monthly wage in EUR
789
800
847
Note:(Data for companies with 20 and more employees.
Source: Statistical Office of the Slovak Republic, TREND (economic weekly magazine)
28
|
TABLE 24
Slovak Mechanical Industry
Change 2011/2010
absolute
index
Indicator
2009
2010
2011
Number of companies
782
700
749
49
107.0%
28.9%
28.4%
28.0%
-0.3%
98.9%
14303.8
18681.9
22964.4
4282.5
122.9%
35%
37.9%
407.4%
369.5
1075.7%
Share of companies on total number in industrial prod.
Revenues for own performances and goods
Share of revenues on total revenues in industrial prod.
Source: Ministry of Economy of the Slovak Republic, Hospodárske noviny (economic daily magazine)
TABLE 25
Manufacture of machinery and equipment (C28) – Basic indicators
Indicator
2008
2009
2010
2010/2008
Revenues for performances and goods in million EUR
3579
1839
2298
-11.8
Value added in million EUR
759
520
692
0.8
Income in million EUR
4176
1981
2656
-12.2
Costs in million EUR
4023
2051
2557
-27
Economic results before taxation
153
-70
99
0.03
45895
29365
30431
-16.2
819
768
839
1.5
Average number of registered employees
Average monthly salary in EUR
Note 2010/2008 = average yearly growth/decline
Source: Ministry of Economy of the Slovak Republic
TABLE 26
Share of mechanical industry divisions on production of revenues
Divisions of mechanical eng.
2008
2009
2010
C25 - Manufacture of fabricated metal products, except machinery and equipment
14.5%
15.5%
11.3%
C28 - Manufacture of machinery and equipment n.e.c.
18.0%
12.9%
12.7%
C29 - Manufacture of motor vehicles, trailers and semi-trailers
64.0%
69.0%
74.3%
C30 - Manufacture of other transport equipment
3.5%
2.6%
1.7%
In total
100%
100%
100%
Source: Ministry of Economy of the Slovak Republic
TABLE 27
Turnover for own performances and goods of mechanical industry in 2012
Divisions of MEM Industries
January
February
March
April
May
June
July
C24+C25 - Basic Metals & Metal Products (mil. €)
772,4
785,8
840,2
800,2
862,9
850,8
845,6
C24+C25 - Basic Metals & Metal Products (index)
102,1
107,1
103,1
107,6
103,3
104,9
112,5
C28 - Machinery & Equipment (mil. €)
265
280,7
299,3
276,6
291,7
286,6
254,1
C28 - Machinery & Equipment (index)
106,9
107,2
95,2
102,7
99
102,9
104,6
C29+C30 - Motor Vehicles & Transport Equip. (mil. €)
1305,9
1695,7
1896,3
1769,6
1962,8
1951
1704,5
C29+C30 - Motor Vehicles & Transport Equip. (index)
111,5
128,1
130,2
134,9
133,7
126,7
154,5
Industrial production C10-C33 in total in million EUR
4958,7
5354,8
6018,5
5513,2
5866,6
5806,5
5400,5
Index
109,1
111,6
111,2
108
109,8
108,4
120
Source: Statistical Office of the Slovak Republic
TABLE 28
Turnover for own performances and goods of mechanical industry in 2010/11
Divisions of MEM Industries
2011
2010
C24+C25 - Basic Metals & Metal Products (mil. €)
9407,6
8409,2
C24+C25 - Basic Metals & Metal Products (index)
106,4
124
C28 - Machinery & Equipment (mil. €)
3129,2
2630,6
C28 - Machinery & Equipment (index)
118,4
133,9
C29+C30 - Motor Vehicles & Transport Equip. (mil. €)
16984,9
13902,9
C29+C30 - Motor Vehicles & Transport Equip. (index)
126,5
138,3
62577,8
54716,4
110,8
120,9
The exports and imports of machinery and equipment
2008
2009
Import of machinery and equipment in million EUR
21626
16443
Total import in million EUR
50280
38775
Export of machinery and equipments in million EUR
26668
21752
Total export in million EUR
49522
26668
Industrial production C10-C33 in total in million EUR
Index
Source: Statistical Office of the Slovak Republic
Exports and imports
TABLE 29
Machinery & Equipment (C 28) – Export and import data
Source: Ministry of Economy of the Slovak Republic
In comparison of years 2010/2009, the export grew for 25%. In 2010 the products of mechanical engineering division represented 8.5%
on the total Slovak export (while it was 8.4% in 2009), while 45% of the production competes with its quality (1st segment) and 35% with
its price (3rd segment). Nearly 10% of export is characterized by structural problems (4 th segment).
30
|
Employment
In mechanical industry in general, the two most important regions from the point of view of employment are Košice region (17.0%) and
Trenčín region (14.8%). While in production of revenues the leading regions are Bratislava region (24.2%), Košice region (16.1%) and
Trnava region (15.8%).
TABLE 30
Share of mechanical industry divisions on employment
Divisions of mechanical eng.
2008
2009
2010
C25 - Manufacture of fabricated metal products
27.1%
26.2%
22.5%
C28 - Manufacture of machinery and equipment n.e.c.
36.7%
26.7%
27.8%
C29 - Manufacture of motor vehicles, trailers and semi-trailers
30.0%
43.7%
46.4%
C30 - Manufacture of other transport equipment
6.2%
3.4%
3.3%
In total
100%
100%
100%
Source: Ministry of Economy of the Slovak Republic
TABLE 31
Employment and production of revenues within Machinery & Equipment (C28)
Indicator/branch
28.1
28.2
28.3
28.4
28.9
% of the group on employment in C 28
53.5%
16.6%
3.6%
6.3%
20.0%
% of group on the production of revenues in C 28
61.3%
15.7%
3.6%
3.6%
15.8%
Source: Ministry of Economy of the Slovak Republic
In 2010, in the structure of employment, the dominant group in C 28 division was C 28.1. Over 90% of employment and nearly 93% of
production of revenues were generated by groups C 28.1, C 28.2 and C 28.9.
The main part of the production capacities of mechanical engineering is located in Žilina region and in Trenčín region. In 2010, 48% of all
registered employees were employed in subjects located in these regions.
Development of investments
Due to economic crisis the volume of investments significantly decreased since end of 2008, but the year 2010 was a year of reviving of
the investments again (although it is visible that investors are still somewhat careful).
TABLE 32
Investments according to divisions
Division
2008
2009
2010
C25 - Manufacture of fabricated metal products (in mil. €)
440
232
n/a
C28 - Manufacture of machinery and equipment (in mil. €)
280
133
n/a
C29 - Manufacture of motor vehicles, trailers and semi-trailers (in mil. €)
586
548
n/a
Industrial production (in mil. €)
3259
2051
2102
Source: Ministry of Economy of the Slovak Republic
Research and development
In general the level of research and development is lacking behind in Slovakia (not only compared to the most developed countries, but
also compared to an average in European Union).
TABLE 33
Expenses on research and development according to divisions
Division
2008
2009
C25 - Manufacture of fabricated metal products (in thousands €)
5631.9
4989.8
C28 - Manufacture of machinery and equipment (in thousands €)
8042.8
5705.7
C29 - Manufacture of motor vehicles, trailers and semi-trailers (in thousands €)
2490.9
19615.8
n/a
6118.7
16135.6
36430
C30 - Manufacture of other transport equipment (in thousands €)
Engineering industry in total
Source: Ministry of Economy of the Slovak Republic
TABLE 34
Employees in research and development in divisions of mechanical industry
Division
2008
2009
C25 - Manufacture of fabricated metal products (in man-hours)
123.7
126.6
C28 - Manufacture of machinery and equipment (in man-hours)
277.9
229.5
C29 - Manufacture of motor vehicles, trailers and semi-trailers (in man-hours)
42.8
42.5
C30 - Manufacture of other transport equipment (in man-hours)
n/a
77.8
444.4
476.4
Engineering industry in total
Source: Ministry of Economy of the Slovak Republic
Market challenges and opportunities
The future market challenges in mechanical engineering include:
o
o
o
o
o
o
o
o
o
32
|
changes related to new markets
strengthening competition of emerging countries (China, Brazil, India, Russian Federation, countries of Southeast
Asia)
demographic changes
changes connected with progressing climate changes
changes in distribution chain structure
new demand and requests of customers
shortening of innovation cycles
implementation of new technologies
lowering the production costs
The future market opportunities in mechanical engineering can be found in:
o
o
o
o
o
o
o
o
development of information technologies
stronger orientation on more sophisticated production
actual small share of high-technology (according to European Innovation Scoreboard classification)
insufficient use of local raw materials in present
using of available free capacities (industrial parks and objects with good infrastructure, qualified workforce, research
and development base etc.)
research and development activities which are lacking behind and are not properly interfaced together
production of components for automotive industry (the automotive industry prefers to use its manufacturing capacities
for different purposes and prefers to commit the production of parts to external contractors)
diversification of production
The biggest enterprises in Mechanical Engineering
The TOP 100 list of the biggest enterprises in mechanical industry in Slovakia (according to revenues by the end of the last financial
year), include the following enterprises active in C 28 division (in thousands EUR, profit after taxation):
-
a.s. – Joint-stock Company
s.r.o. – Limited Liability Company
TABLE 35
TOP 38 Manufacturers of machinery and equipment (C28)
Revenues Revenues Change
2011
2010
2011/2010
Profit
2011
Profit
2010
Change
2011/2010
region
NACE
code
21.9%
11739
20139
-41.7%
Žilina
28.15
227779
58.3%
11225
2294
389.3%
Košice
28.15
341425
265567
28.6%
9252
11577
-20.1%
Trnava
28.15
Embraco Slovakia s.r.o.
176083
168216
4.7%
n
2325
-100.0%
Košice
28.13
22.
Sauer-Danfoss a.s.
118399
98682
20.0%
9412
5755
635%
Trenčín
28.13
31.
PSL a.s.
80949
54300
49.1%
4107
-3888
N
Žilina
28.15
32.
PPS Group a.s.
68682
48835
40.6%
4121
4337
-5.0%
B.
Bystrica
28.92
33.
GGP Slovakia s.r.o.
65488
38359
70.0%
619
-285
N
Prešov
28.30
34.
Slovnaft montáže a opravy a.s.
61791
77662
-20.4%
979
964
1.6%
Bratislava
28.13
38.
Stroje a mechanizmy a.s.
51058
40588
25.8%
5709
5676
0.6%
Trnava
28.92
39.
Bonfiglioli Slovakia s.r.o.
50759
46973
8.1%
1799
1982
-9.2%
Žilina
28.15
43.
Matador industries a.s.
44451
17346
156.3%
607
189
221.2%
Trenčín
28.99
47.
Manz Slovakia s.r.o.
36590
35441
3.2%
-364
329
N
Trenčín
28.96
53.
ZTS Strojárne s.r.o.
26812
19785
35.5%
1264
683
85.1%
Žilina
28.93
54.
Kinex a.s.
25523
21280
19.9%
-378
-58
N
Žilina
28.15
56.
Team Industries s.r.o.
24676
16519
49.4%
285
-99
N
Žilina
28.13
57.
Konštrukta - Industry a.s.
24659
37774
-34.7%
1144
1797
-36.3%
Trenčín
28.99
28.92
No.
Company name
7.
INA Kysuce a.s.
374562
307191
8.
GETRAG s.r.o.
360473
9.
INA Skalica s.r.o.
14.
65.
WAY Industries a.s.
20351
15653
30.0%
n
45
-100.0%
B.
Bystrica
67.
Lombardini Slovakia s.r.o.
18155
15649
16.0%
381
987
-61.4%
Žilina
28.11
69.
MicroStep s.r.o.
17376
10250
69.5%
1001
169
492.3%
Bratislava
28.4
74.
Camil Farr s.r.o.
15300
14300
7.0%
n
n
n
Nitra
28.25
75.
Pellenc s.r.o.
14458
13111
10.3%
937
887
5.6%
Trenčín
28.30
78.
Marel Slovakia s.r.o.
12396
8099
53.1%
-282
425
n
Nitra
28.93
80.
SB Inmart a.s.
11391
8076
41.0%
1004
403
149.1%
Prešov
28.13
B.
Bystrica
B.
Bystrica
86.
Slavia Tools a.s.
9580
6800
40.9%
755
-251
n
88.
Hriňovské strojárne a.s.
9566
8313
15.1%
54
350
-84.6%
91.
VIPO a.s.
8833
6907
27.9%
324
138
134.8%
Trenčín
28.99
92.
Virtual Reality Media a.s.
8270
2390
246.0%
698
267
161.4%
Trenčín
28.99
Source: TREND Analyses
34
|
28.4
28.15
Company profiles of TOP 10 enterprises in Mechanical Engineering (C28)
INA Kysuce a.s., INA Skalica s.r.o.
Contact Data
Ul. Dr. G. Schaefflera 1, 024 01 Kysucké Nové Mesto, Slovakia
T: +421 41 4 205 911
F: +421 41 4 205 918
info.sk@schaeffler.com
www.schaeffler.sk
Brief Description
Both companies belong under multinational German Schaeffler Group. The manufacturing plant of INA Kysuce is
located in the region of Žilina, the manufacturing plant of INA Skalica is located in Trnava region.
In TOP 100 list of the biggest enterprises in Slovak engineering industry is INA Kysuce on 7th position and INA
Skalica on 9th position.
Products
Manufacture of bearings, gears, gearing and driving elements.
Time in Market
The company was established in 1999 (nearly 13 years of existence), but its very first activities in Slovakia date
back to year 1987 (Czechoslovakia).
Size of Company
Both companies have over 8000 employees in total (they belong among the biggest employers in the engineering industry in Slovakia).
INA Kysuce and INA Skalica are the two strongest players on gears market in Slovakia.
Turnover (in thousands €) of INA Kysuce a.s.
 2011: 374562
 2010: 307191
Turnover (in thousands €) of INA Skalica s.r.o.
 2011: 341425
 2010: 265567
Strength &
Weaknesses
Strengths:
Weaknesses
 Established presence on western markets
 Dependency on automotive industry
 Being part of strong multinational group which sup-  Unclear strategy of how to proceed in a case that
ports its growth within the group
the competition from east will continue to strengthen
 High qualification of employees
(due to lower costs for workforce)
Notes
Since 1991 both companies invested over 173 million EUR in Slovakia. A further investment of 80 to 90 million
EUR was announced for year 2013. For the first time the companies consider to run for governmental investment
incentives (for the e-mobility area).
Majority of the production of both companies is exported out of Slovakia. Their main customers include
Volkswagen, Ford, BMW, Daimler, SKF and others.
GETRAG FORD Transmissions Slovakia s.r.o.
Contact Data
Perínska cesta 282, 044 58 Kechnec, Slovakia
T: +421 55 614 8300
F: +421 55 614 8309
christophe.baptiste@getrag.com
www.getrag.com
Brief Description
The company is a part of Getrag Corporate Group. The manufacturing plant is located in a village of Kechnec, in
a neighbourhood of Košice city (the second biggest Slovak city). In TOP 100 list of the biggest enterprises in
Slovak engineering industry is the company on 9th position.
Products
 dual clatch transmissions
Time in Market
Nearly for 8 years, since January 2005.
Size of Company
Number of employees: 820 in 2012
Turnover (in thousands €):
 2011: 360473
 2010: 227779
Production (of dual clatch transmissions):
 2011: 230000 (estimation)
 2010: 122000
Strength &
Weaknesses
Strengths:
 Being a part of multinational group
 Easy access to western markets
Notes
The production of the company and number of employees continue to grow gradually (in 2011 the company
employed 230 new employees). Recently the company announced to have new orders until year 2016.
Nearly the whole production is exported out of Slovakia (dual clatch transmissions for Ford, Volvo and Mitsubishi
cars).
The company also has a related sub-company Getrag s.r.o. which is also located in Kechnec, has 150 employees and produces motorcycle transmissions and timing gears. The whole production is exported out of Slovakia
to be used in BMW and Harley Davidson motorbikes.
36
|
Weaknesses
 Limited production portfolio
 Endangered access to the new R4 motorway from
Košice to Hungary
Embraco Slovakia s.r.o.
Contact Data
Odorínska cesta 2, 052 01 Spišská Nová Ves, Slovakia
T: +421 53 417 2110
F: +421 53 417 299
recepcia@embraco.sk
www.embraco.sk
Brief Description
The company is a branch of multinational Brazil corporation. The manufacturing facility is located in Spišská
Nové Ves (eastern Slovakia).
Products
Manufacture of compressors and installation of condensing units.
Time in Market
The company entered Slovakia in December 1997, the production started in March 1998 (nearly 15 years of
existence).
Size of Company
Number of employees: 2400 in 2012.
Turnover (in thousands €):
 2011: 176083
 2010: 168216
Production (of compressors):
 2011: over 3.5 million
 2012: over 4.5 million (estimation)
Strength &
Weaknesses
Strengths:
Weaknesses
 Being a part of multinational group.
 Limited production portfolio.
 Having and continuing to develop their own R&D
department
Notes
Most of the company´s production is exported out of Slovakia. The main purchasers are Electrolux, Whirlpool,
Indesit, Bosch and Gorenje.
The company received a governmental investment incentive in a value of 6.5 million EUR for enlarging of the
existing manufacture facility.
The company announced a plan to invest around 3.8 million EUR during year 2012 into upgrading of production
processes (in order to increase the productivity and quality).
Sauer – Danfoss a.s.
Contact Data
Kukučínova 2148-84, 017 01 Považská Bystrica, Slovakia
T: +421 42 430 11 11
F: +421 42 430 1203
rolah@sauer-danfoss.com
www.sauer-danfoss.sk
Brief Description
The company is a part of a multinational group Sauer – Danfoss Inc. The two manufacturing plants are located in
Považská Bystrica city and Dubnica nad Váhom city. Also The European Service Centre of Sauer – Danfoss is
located in Slovakia.
Products
Production of other pumps and compressors.
Time in Market
The company entered Slovakia in 1995 (nearly 18 years of existence).
Size of Company
Number of employees: approximately 1000
Turnover (in thousands €):
 2011: 118399
 2010: 98682
Predicted turnover for 2012: 105 million EUR
Strength &
Weaknesses
Strengths:
 Part of the production portfolio are unique products
 Being a part of multinational group
Notes
The company is one of the biggest investors and exporters in Slovak engineering industry, but the first wave of
recession hit it hard.
98% of the production is exported out of Slovakia, mainly to markets in western Europe and to USA.
The Slovak branch started to develop cooperation with China recently.
38
|
Weaknesses
 Difficulties to handle the decreasing number of orders from July 2012
 Unable to stop part of production moving to China
due to lower production costs
PSL a.s.
Contact Data
Robotnícka ulica, 017 01 Považská Bystrica, Slovakia
T: +421 42 4371 111
F: +421 42 4326 644
pslpb@pslas.com
www.pslas.com
Brief Description
The company was established in year 1995 and has 3 daughter business companies located in USA, Germany
and Russian Federation. The company is a daughter company of the German group ThyssenKrupp. The manufacturing plant is located in Považská Bystrica (Žilina region). Apart from manufacturing activities the company
offeres a whole range of services connected with its products (technical support, packing, service of bearings
etc.).
Products
Production of rolling bearings, slewing bearings, worm drivers, machined rings and bearing rollers.
Time in Market
The company was established in March 1995 (nearly 18 years of existence).
Size of Company
Number of employees: 1050
Turnover (in thousands €):
 2011: 80949
 2010: 54300
Strength &
Weaknesses
Strengths:
 Manufacturing of high quality products
 Being part of a strong German group
Notes
95% of the production is exported out of Slovakia to Germany, France, Italy, USA, Canada, Sweden, Finland,
Czech Republic, Russian Federarion, Germany, Japan, India and Australia.
In 2011 the company reached a ranking of 123rd biggest company in Slovakia according to revenues, and 40th
biggest exporter of goods and services.
Weaknesses
 Strong dependency on development in the area of
renewable energy sources
PPS Group a.s.
Contact Data
Areál PPS Group, Tajovského 7, 962 12 Detva, Slovakia
T: +421 45 5219 202
F: n/a
pps@ppsgroup.com
www.ppsgroup.com
Brief Description
The history of the company dates back to year 1950, when it started its operation as a state-owned company
(Czechoslovakia). The modern history of the company started in year 2003, when it was privatised. The new
owners became a group of private Swiss and Czech investors, and Slovak investment group SITNO HOLDING
a.s. The manufacturing plant is located in Detva (Banská Bystrica region).
Products
Production of complete sets of parts for mining industry, kinematic elements for construction and handling machines and equipment, security features and frames for forestry equipment, production of weldments for defence
machines, steel constructions for rolling stock and fixtures.
Time in Market
Since 2003 (nearly for 11 years).
Size of Company
Number of employees: over 1500
Turnover (in thousands €):
 2011: 68682
 2010: 48835
Strength &
Weaknesses
Strengths:
Weaknesses
 The company benefits from its long production histo-  Lack of qualified workers in present
ry and good image until nowadays.
 Cooperation with a whole range of well-known foreign producers.
Notes
According to the company´s statement, the first half of year 2012 has been the most successful in their history,
but they predict the second half of the year as a weak one (as for the orders).
The customers of the company include Volvo, Atlas Copco via TSP, Komatsu-Hanomag, Sonnenbogen, Caterpillar, Liebherr, John Deere, GHH Fahrzeuge and Siemens.
40
|
GGP Slovakia s.r.o.
Contact Data
Priemyselná 4686/1, 059 51 Poprad-Matejovce, Slovakia
T: +421 52 787 94 69
F: +421 52 787 94 18
marek.dragotek@ggp-group.com
www.ggp-group.com
Brief Description
GGP Slovakia is a daughter company of the Italian GGP ITALY SPA, which is owned by the Dutch investment
bank ABN AMRO. The company and its manufacturing facility are located in the industrial park PopradMatejovce, where it covers over 26,500 square meters area.
Products
Production of garden lawn mowers (engines electric, battery or petrol driven)
Time in Market
From March 2006 (nearly 7 years of existence).
Size of Company
Number of employees: approximately 350
Turnover (in thousands €):
 2011: 65488
 2010: 38359
Average daily production of lawn mowers: approximately 1,000
Strength &
Weaknesses
Strengths:
Weaknesses
 Being a part of strong multinational group
 The company faces problems with workers regularly
 Having a stable position on markets of western
(especially with lack of qualified workforce in the reEurope (as for export and sale)
gion of Prešov)
Notes
The company invested 10 million EUR into their manufacturing facility.
GGP Slovakia attracted other companies to the industrial park Poprad-Matejovce in order to produce components and provide services for it (for example Marco Climatech, LPH, RoTTeL etc.).
Majority of the production is exported out of Slovakia – around 5% is sold on Slovak and Czech market, 30-40%
on other CEE markets and the rest on the markets in western Europe.
Slovnaft montáže a opravy a.s.
Contact Data
Vlčie hrdlo, P.O.BOX 52, 820 03 Bratislava 23, Slovakia
T: +421 2 4055 8724
F: +421 2 4055 8171
mao@mao.slovnaft.sk
www.smao.sk
Brief Description
The company is a daughter company of the Slovnaft refinery which belongs under Hungarian MOL Group. It is
located in the capital city of Bratislava. The core business of the company is providing various types of services
for engineering industry, railways etc.
Products
Producing of other pumps and compressors.
Time in Market
The company was established in August 1993 (nearly 20 years of existence).
Size of Company
Number of employees: unknown
Turnover (in thousands €):
 2011: 61791
 2010: 77662
Strength &
Weaknesses
Strengths:
 Being a part of strong group
 Slovnaft brand has a high recognition in Slovakia
Notes
The main customers of the company include Slovalco, ŽOS Trade, Ostravské opravovny a strojírny, Invest IN,
BASF and GEA Spiro-Gills.
42
|
Weaknesses
 Limited production assortment
Stroje a mechanizmy a.s.
Contact Data
Roľníckej školy 1519, 945 25 Komárno, Slovakia
T: +421 35 773 22 32
F: +421 35 774 0190
info@samstroje.sk
www.samstroje.sk
Brief Description
The history of the company is reaching back to the end of 19 th century. The modern history of the company started with its privatisation and establishing in year 2001. It is owned by private Slovak investors. The company has
two manufacturing facilities, located in Komárno and Bratislava (Metalchem).
Products
Production of pressure vessels, columns, heat exchangers, air coolers, vacuum vessels, undercarriages, boats
and ships, recycling machines, tanks for railway, assembly and services.
Time in Market
The company was officially established in November 2001 (nearly 11 years of existence).
Size of Company
Number of employees: unknown
Turnover (in thousands €):
 2011: 51058
 2010: 40588
Strength &
Weaknesses
Strengths:
Weaknesses
 The new ownership of the shipyards (see below) will  The company has too many connections with the
fuel a further development of the company.
Hungarian political party which is in opposition since
the early parliamentary elections in March 2012.
Notes
Some of the most important clients of the company are Slovnaft, Sennebogen, Caterpillar, TEREX, METSO, Vest
In and BASF.
In August 2008 the company became a new owner of Slovenské lodenice Komárno (the only Slovak shipyard),
which was previously owned by the European Investment Bank AG – Euram.
3.3 Electrical Engineering
At the beginning of the transformation period (from the year 1989 on) the electrical engineering (C 26 and C 27) was considered to be a
sector without further perspectives for development in Slovakia, mainly because of lagging behind the worlds production trends. But after
the year 2000 the sector started to experience a rapid growth and electrical engineering plays an important and irreplaceable role in the
structure of Slovak industry ever since.
Its development was fuelled by the massive entry of foreign investors) this sector belongs among the sectors with the highest dominancy
of foreign capital) and by automotive industry and its needs.
The electrical engineering sector was very negatively influenced by the economic crisis during the years 2008 and 2009 (although the fall
of production was not that dramatic than in the whole industry in general), but the sector started to revive again in the following year 2010.
TABLE 36
Basic indicators of the Electrical Engineering sector in period 2008-2010
Indicator
2008
2009
2010
2010/2008
Revenues for performances and goods in million EUR
9032
8179
8799
-0.9
Value added in million EUR
1180
924
1164
2.2
Income in million EUR
9809
8476
10519
5.1
Costs in million EUR
9686
8457
10125
3.5
Economic results before taxation
123
299
394
136
72359
43710
42154
-21.3
667
713
762
6.8
Average number of registered employees
Average monthly salary in EUR
Note: 2010/2008 = average yearly growth/decline
Source: Ministry of Economy of the Slovak Republic
TABLE 37
Manufacture of computer, electronic and optical products (C26) – Basic indicators
Indicator
2008
2009
2010
2010/2008
Revenues for performances and goods in million EUR
6173
6224
6654
3.9
Value added in million EUR
530
586
716
16.2
Income in million EUR
6664
6532
8153
11.4
Costs in million EUR
6564
6253
7870
10.6
Economic results before taxation
100
278
283
92
23058
19750
18454
-10.5
734
706
752
1.4
Average number of registered employees
Average monthly salary in EUR
Note: 2010/2008 = average yearly growth/decline
Source: Ministry of Economy of the Slovak Republic
44
|
TABLE 38
Manufacture of electrical equipment (C27) – Basic indicators
Indicator
2008
2009
2010
2010/2008
Revenues for performances and goods in million EUR
2859
1955
2145
-28.3
Value added in million EUR
650
338
448
-7.8
Income in million EUR
3145
2224
2366
-11.5
Costs in million EUR
3122
2204
2255
-13.6
23
21
111
44
49301
23960
23700
-26.3
634
719
770
10.3
Economic results before taxation
Average number of registered employees
Average monthly salary in EUR
Note: 2010/2008 = average yearly growth/decline.
Source: Ministry of Economy of the Slovak Republic
TABLE 39
Share of electrical engineering industry divisions on production of revenues
Divisions of electrical eng.
2008
2009
2010
C26 - Manufacture of computer, electronic and optical products
64.4%
76.1%
75.6%
C27 - Manufacture of electrical equipment
31.6%
23.9%
24.4%
In total
100%
100%
100%
Source: Ministry of Economy of the Slovak Republic
The C 26 division is the dominant one from the point of view of revenues production and it is continuing to strengthen its position.
TABLE 40
Turnover for performances and goods in year 2012 (C 26, C 27)
Divisions of MEM Industries
January February
March
April
May
June
July
C26 - Computer, electronic & optical products (mil.€)
533,7
405,8
533,4
544,5
538,9
436,8
288,5
C26 - Computer, electronic & optical Products (index)
127,1
98,7
110,7
93,8
108,8
110
120,6
C 27 - Manufacture of electrical equipment (mil. €)
209,8
221,8
244,8
200,7
219,7
219,5
206,1
C 27 index - Manufacture of electrical equipment
104,7
104
99,8
100,1
94,9
90,5
101,1
Industrial production C10-C33 in total (mil. €)
4958,7
5354,8
6018,5
5513,2
5866,6
5806,5
5400,5
Index
109,1
111,6
111,2
108
109,8
108,4
120
Source: Ministry of Economy of the Slovak Republic
TABLE 41
Turnover for performances and goods in 2010 and 2012 (C26, C27)
Divisions of MEM Industries
2011
2010
C26 – Manufacture of computer, electronic & optical products (mil.€)
6064,1
6816,1
C26 – Manufacture of computer, electronic & optical Products (index)
90,2
117,9
C 27 - Manufacture of electrical equipment (mil. €)
2638,6
2364
C 27 index - Manufacture of electrical equipment
109,6
117,9
62577,8
54716,4
110,8
120,9
Industrial production C10-C33 in total (mil. €)
Index
Source: Ministry of Economy of the Slovak Republic
Exports and imports
TABLE 42
Export and import of computer, electronic & optical products (C26)
C 26
2008
2009
1Q 2010
Export in million EUR
8705,26
8624,13
1953,26
Import in million EUR
8358,81
7068,44
1741,6
2008
2009
1Q 2010
Export in million EUR
2733,06
2280,39
612,03
Import in million EUR
2762,79
2250,23
557,57
Source: Slovenská informačná a marketingová spoločnosť
TABLE 43
Export and import of electrical equipment (C27)
C 27
Source: Slovenská informačná a marketingová spoločnosť
Employment
The capacities of Slovak electrical engineering are concentrated in western part of Slovakia. 61.5% of persons employed in electrical
engineering sector work in the regions of Trnava, Nitra and Trenčín. The three named regions produce 81.3% of the overall production in
the electrical engineering sector.
Employment in detail:
o
Trenčín region – 24.9%
o
Nitra region – 19.0%
o
Trnava region – 17.6%
Production according revenues in detail:
o
Trnava region – 45.3%
o
Nitra region – 23.8%
o
Trenčín region – 12.2%
46
|
TABLE 44
Share of electrical engineering industry divisions on employment
Divisions of electrical eng.
2008
2009
2010
C26 - Manufacture of computer, electronic & optical products
31.9%
45.2%
43.8%
C27 - Manufacture of electrical equipment
68.1%
54.8%
56.2%
In total
100%
100%
100%
Source: Ministry of Economy of the Slovak Republic
The C 27 division is the dominant one from the point of view of employment, but its share has a decreasing tendency, while the share of
C 26 division continues to grow (for 11.9% if comparing years 2008 and 2010).
TABLE 45
Employment and production of revenues within C 26 division in 2010
Indicator/branch
26.1
26.2
26.3
26.4
26.5
26.6
26.7
% of the group on employment
38.7%
n/a
7.7%
39.7%
8.4%
n/a
n/a
% of the group on the producion of rev.
16.2%
n/a
1.3%
78.5%
2.5%
n/a
n/a
Source: Ministry of Economy of the Slovak Republic
In 2010, in the structure of employment, the dominant groups in C 26 division were C 26.1 and C 26.4 (78.4% of employment within the C
26 division). The group C 26.4 is the dominant group from point of view of production of revenues (together with C 26.1 they produce
94.7% of revenues within C 26 division).
TABLE 46
Employment and production of revenues within C 27 division in 2010
Indicator/branch
27.1
27.3
27.4
27.5
27.9
% of the group on employment
36.6%
19.5%
21.7%
10.2%
12.0%
% of the group on the production of rev.
37.9%
11.9%
20.5%
16.4%
13.3%
Source: Ministry of Economy of the Slovak Republic
In 2010, it was the group C 27.1 which had the clearly dominant position within C 27 division, both according to employment and production of revenues.
Development of investments
In 2009 the volume of investments significantly decreased due to global financial and economic crisis, but the volume started to grow
again from 2010 on. In 2010 the volume of investments per employee is much higher than in industrial production in general.
TABLE 47
Investments according to electrical engineering divisions
Divisions of electrical engineering
2008
2009
2010
C26 - Manufacture of computer, electronic & optical products (in million €)
208
146
227
C27 - Manufacture of electrical equipment (in million €)
155
95
124
Electrical engineering in total (in million €)
363
241
351
Industrial production in total (in million €)
3259
2051
2102
Source: Ministry of Economy of the Slovak Republic
Research and development
In general the level of research and development is lacking behind in Slovakia (not only compared to the most developed countries, but
also compared to an average in European Union).
TABLE 48
Expenses on research and development in a relation to Slovak economy
Electrical Engineering (in persons)
Slovak Republic in total (in persons)
2008
2009
2010
21671
7096
n/a
316459,3
302994,3
416369
Source: Ministry of Economy of the Slovak Republic
TABLE 49
Number of employees in research and development in a relation to Slovak economy
Electrical Engineering (in persons)
Slovak Republic in total (in persons)
2008
2009
2010
343
336
n/a
23641
25388
28128
Source: Ministry of Economy of the Slovak Republic
TABLE 50
Man-hours of employees in research and development in a relation to Slovak economy
Electrical Engineering
Slovak Republic in total
2008
2009
2010
206
258,9
n/a
15576,1
15951,6
n/a
Source: Ministry of Economy of the Slovak Republic
TABLE 51
Expenses on research and development according to divisions
2008
2009
C26 - Manufacture of computer, electronic & optical products (in thousands €)
1849
1134
C27 - Manufacture of electrical equipment (in thousands €)
19822
5962
Electrotechnical engineering in total (in thousands €)
21671
7096
2008
2009
C26 - Manufacture of computer, electronic & optical products (in persons)
89
49
C27 - Manufacture of electrical equipment (in persons)
254
287
Electrotechnical engineering in total (in persons)
343
336
Source: Ministry of Economy of the Slovak Republic
TABLE 52
Number of employees in research and development according to divisions
Source: Ministry of Economy of the Slovak Republic
48
|
TABLE 53
Man-hours of employees in research and development according to divisions
2008
2009
C26 - Manufacture of computer, electronic & optical products
73.1
34.7
C27 - Manufacture of electrical equipment
132.9
224.2
Electrical enginnering in total
206.0
258.9
Source: Ministry of Economy of the Slovak Republic
Market challenges and opportunities
The future market challenges in electrical engineering include:
o
o
o
o
o
o
lowering of the production costs
increasing automation of automotive industry and its need for hardware and software (of production systems)
continuing dependency on automotive industry
changes in distribution chain structure
new demand and requests of customers
shortening of innovation cycles
The future market opportunities in mechanical engineering can be found in:
o
o
o
o
o
o
further development of automotive sector which would represent new possibilities for components producers
orientation on more sophisticated research and production
building up of customer service centers for manufacturing facilities located in Slovakia
full liberalization of the energy market, construction and upgrading of energy infrastructure
to relocate consulting IT companies to Slovakia
building up of logistic centers in Slovakia
Biggest enterprises in Electrical Engineering
The TOP 30 list of the biggest enterprises in electrical engineering industry in Slovakia (according to revenues by the end of the last financial year in thousands EUR plus profit after taxation):
-
a.s. – Joint-stock Company
s.r.o. – Limited Liability Company
TABLE 54
TOP 30 producers from electrical engineering sector ( C26 and C27)
Revenues Revenues
No. Company name
Change
Profit
Profit
Change
2011
2010
2011/2010
2011
2010
2011/2010
region
1.
Samsung Electronics Slovakia s.r.o.
3167764
3247193
-2.4%
164872
118048
39.7%
Trnava
2.
Foxconn Slovakia s.r.o.
1042270
1426743
-26.9%
2630
3848
-31.7%
Nitra
3.
Whirlpool Slovakia s.r.o.
264070
282906
-6.7%
-7995
409
N
Bratislava
4.
Emerson a.s.
248348
183805
35.1%
11895
7737
53.7%
Trenčín
5.
Universal Media Corporation s.r.o.
235982
160207
47.3%
2030
2550
-20.4%
Bratislava
6.
BSH Drives and Pumps s.r.o.
201525
168888
19.3%
11094
8665
28.0%
Košice
7.
Halla Climate Control Slovakia s.r.o.
200882
171135
17.4%
5889
9138
-35.6%
Trenčín
8.
Panasonic AVC Networks s.r.o.
124467
145708
-14.6%
1406
5477
-74.3%
Košice
9.
Osram a.s.
120643
108816
10.9%
5933
3751
58.2%
Nitra
10.
Delta Electronics s.r.o.
116361
139799
-16.8%
n
n
N
Trenčín
11.
Panasonic Electronic Devices s.r.o.
111396
103130
8.0%
-627
657
N
Žilina
12.
Elster s.r.o.
105453
100297
5.1%
13846
14119
-1.9%
Trenčín
13.
Semikron s.r.o.
90975
75447
20.6%
2390
2728
-12.4%
Trnava
14.
Magneti Marelli Slovakia s.r.o.
87696
71894
22.0%
-14822
-13343
N
Bratislava
15.
Askoll Slovakia sr.o.
79808
81955
-2.6%
3116
2718
14.6%
Trenčín
16.
ZKW Slovakia s.r.o.
70573
49541
42.5%
11007
11073
-0.6%
Nitra
17.
OMS s.r.o.
68856
59167
16.4%
119
242
-50.8%
Trnava
18.
Leoni Slovakia s.r.o.
62352
55159
13.0%
4558
4894
-6.9%
Trenčín
19.
PPA Controll a.s.
53781
18345
193.2%
5890
6715
-12.3%
Bratislava
20.
ABB s.r.o.
52147
44057
19.7%
2703
2126
27.1%
Bratislava
21.
PPA Energo s.r.o.
51147
30317
68.7%
2972
3773
-21.2%
Bratislava
22.
Eltek s.r.o.
50095
36943
35.6%
688
351
96.0%
Žilina
23.
Alcatel-Lucent Slovakia s.r.o.
45062
23554
91.3%
408
1008
-59.5%
Bratislava
24.
Schneider Electric Slovakia s.r.o.
42887
40809
5.1%
1576
3250
-51.5%
Bratislava
25.
Vicente Torns Slovakia a.s.
41588
31655
31.4%
-1384
-774
n
Nitra
26.
Enics Slovakia s.r.o.
37745
19420
94.4%
-1332
-3072
n
Trenčín
27.
Leoni Cable Slovakia s.r.o.
23583
22700
3.9%
427
970
-56.0%
Trenčín
28.
Tesla Stropkov a.s.
22263
17573
26.7%
1617
847
90.9%
Prešov
29.
ICS Industrial Cables Slovakia s.r.o.
21386
16789
27.4%
5
-304
N
Nitra
30.
Hella Innenleuchten - Systeme s.r.o.
21073
18258
15.4%
1371
1298
5.6%
Bratislava
Source: TREND Analyses
50
|
Company profiles of TOP 10 enterprises in Electrical Engineering
Samsung Electronics Slovakia s.r.o.
Contact Data
Hviezdoslavova 807, 924 27 Galanta, Slovakia
T: +421 31 7882 111
F: +421 31 7882 509
sesk @samsung.com
www.samsung.sk
Brief Description
Samsung Electronics Slovakia is a daughter company of Korean Samsung Electronics and the player no. 1 in
electrical engineering sector in Slovakia. The manufacturing facility is located in Galanta and it is the biggest
manufacturing facility of Samsung in Europe. The company runs also other manufacturing facility in Voderany
which produces main screen components of LCD televisions (the whole production is used in Galanta manufacturing facility or sold to Sony Slovakia).
Products
LCD televisions with LED technology
Time in Market
Since June 2002 (nearly 11 years of existence).
Size of Company
Number of employees: approximately 1800
Turnover (in thousands €):
 2011: 3167764
 2010: 3247193
The manufacturing facility in Galanta produced over 60 million products since 2002.
The yearly production of LCD television is 6 million pieces.
Strength &
Weaknesses
Strengths:
Weaknesses
 Being a part of strong multinational company
 Negative image due to affair with Apple Inc.
 Continual investments into modernisation of produc-  Without receiving the tax reliefs is the competitivetion
ness of the company endangered
Notes
Since 2002 Samsung invested over 350 million EUR in the manufacturing facility in Galanta. The original product
portfolio was wider than just LCD televisions and it included also LCD monitors, MP3 players, DVD players, Blueray, home cinema and other consumers electronics, but this production was moved to other countries such as
Hungary or Romania (due to lower production costs).
Almost the whole production is exported out of Slovakia, only around 1% is sold on domestic Slovak market.
High share of the production is exported to markets of western Europe.
Since beginning of the year 2012 the company is running for additional governmental investment incentives (19.8
million EUR tax relief), but the result is not known yet.
Foxconn Slovakia s.r.o.
Contact Data
Dolné Hony 29, 949 02 Nitra, Slovakia
T: +421 37 6444 101
F: +421 37 6444 107
info@foxconn.sk
www.foxconnslovakia.sk
Brief Description
The company is a subsidiary of the Taiwanese company Hon Hai Precision Industry. The manufacturing facility is
located in Nitra. It was formerly a manufacturing facility owned by Sony (since August 2007).
Products
 Production of LCD televisions.
Time in Market
Since July 2010 (over 2 years of existence).
Size of Company
Number of employees: 1300
Turnover (in thousands €):
 2011: 1042270
 2010: 1426743
Production of LCD televisions:
 2012: 1.3 million (planned)
 2011: 2.1 million
 2010: 2.6 million
Strength &
Weaknesses
Strengths:
 Being a subsidiary of a strong company
Notes
The company announced that the year 2012 is going to be the worst in its history because Sony ordered one
third less televisions as during the previous year.
52
|
Weaknesses
 Full dependency on orders from Sony
Whirlpool Slovakia s.r.o.
Contact Data
Galvaniho 17/C, P.O.BOX 23, 820 09 Bratislava, Slovakia
T: +421 2 5810 4401
F: +421 2 5810 4444
whirlpool.sk@whirlpool.com
www.whirlpool.sk
Brief Description
The company is a daughter company of the American Whirlpool Corporation. The manufacturing facility is located in the city of Poprad (it is the biggest manufacturing facility producing washing machines in the region of central Europe and the leading European manufacture of Whirlpool Corporation).
Products
 Production of top load washers.
Time in Market
Since November 2001, when Whirlpool first established a common company with ex-Czechoslovak company
Tatramat (nearly 21 years of existence).
Size of Company
Number of employees: approximately 900
Turnover (in thousands €):
 2011: 264070
 2010: 282906
By 2011 the company produced 20 million top load washers.
Strength &
Weaknesses
Strengths:
 Being a part of strong American corporation
Notes
In 2011 the company received an award for high quality production from the Slovak Parliament.
Whirlpool is one of the most important exporters in Slovakia – 97% of the production is exported to markets of
western Europe, Marocco and Hong Kong.
Weaknesses
 Limited production portfolio
Emerson a.s.
Contact Data
Piešťanská 1202/44, 915 28 Nové Mesto nad Váhom, Slovakia
T: +421 32 7700 201
F: +421 32 7700 201
info.corpsk@emerson.com
www.emerson.sk
Brief Description
The company is a local representation of American manufacturing and technology company Emerson, in Slovakia it operates within 7 divisions: Branson, Emerson Network Power, Energy Systems, European Systems
Assembly & Distribution Systems, KOP-FLEX, White-Rodgers, ASCO Numatics and business Representation of
Control Techniques. The manufacturing plant is located in Nové Mesto nad Váhom.
Products
Production according to divisions:
 Branson: ultrasonic and vibration welding equipment for plastics used primarily in the automotive industry,
ultrasonic instruments and accessories
 Emerson Network Power: industrial airconditioners, electric power supplies, wiring harnesses and copper bus
bars
 Energy Systems: power supplies for the telecommunications industry, providing complex energy solutions for
IT and telecommunications market
 European Systems Assembly & Distribution Systems: manufacturing and installation of DeltaV and DeltaV SIS
control systems
 KOP-FLEX: clutches for heavy industrial turbines, compressors, generators and propulsion
 White-Rodgers: electronic and control systems (printed circuit boards for gas appliances, electrical heating, air
conditioning and refrigeration equipment)
Time in Market
The company was established in May 1992 (nearly 21 years of existence).
Size of Company
Number of employees: approximately 1200
Turnover (in thousands €):
 2011: 248348
 2010: 183805
Strength &
Weaknesses
Strengths:
Weaknesses
 Being a part of international company
 Lack of qualified workforce in the regions (especially
 Very wide and diverse product portfolio connected
university educated people)
with providing of services
Notes
The company produces components also for Whirlpool Slovakia and automotive industry.
For a long time, the company has been active via its two daughter companies Emerson Electric Slovakia s.r.o.
and Emerson a.s. Towards the end of 2008, Emerson sold the Emerson Electric Slovakia production (manufacturing of electric engines for white appliances) to Askoll company.
54
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Universal Media Corporation /Slovakia/ s.r.o.
Contact Data
L. Podjavorinskej 16., 915 01 Nové Mesto nad Váhom, Slovakia
T: +421 32 7747 103
F: +421 32 7714 219
info@umc-slovakia.sk
www.umc-slovakia.sk
Brief Description
The company is the only Slovak producer of televisions. The 24000 square meters manufacturing facility is located in Nové Mesto nad Váhom city.
Products
 Production of LCD and LED televisions.
Time in Market
From December 2003 (nearly 8 years of existence).
Size of Company
Number of employees: approximately 700
Turnover (in thousands €):
 2011: 235982
 2010: 160207
The production capacity of the manufacture is 4 million televisions per year.
Strength &
Weaknesses
Strengths:
 The company provides services and support too
 Production of private brands too
 Own research and development activities
Notes
The company produces its own Sky brand, also for Blaupunkt brand, private brands such as Tesco and announced to entry new export markets from 2012 on. So far the export markets included Germany, France, Hungary, Austria, Czech Republic, Italy and Spain.
During summer 2012 the company reconstructed the manufacturing facility and increased the number of its
production lines from 4 to 8.The company would like to attract additional foreign investors/suppliers to Nové
Mesto nad Váhom.
Due to the lack of storage capacities the company is planning to build up a 60000 square meter large special
centre of strategic services (service centrum, support centre, research and development division), which represents an investments of 20 million EUR. The company wants to run for governmental investment incentives.
Weaknesses
 Lack of storage capacities
 Necessity of investment incentives to fuel the further
development
BHS Drives and Pumps s.r.o.
Contact Data
Továrenská 2, 071 90 Michalovce, Slovakia
T: +421 56 6417 404
F: +421 56 6417 264
martina.moskalova@bshg.com
www.bsh-group.sk
Brief Description
BHS Drives and Pumps is a daughter company of BSH Bosch and Siemens Hausgaräte. The manufacturing
facility is located in Michalovce, the company is the largest electronic producer in eastern Slovakia.
Products
 Production of electric motors for household appliances.
Time in Market
Since December 1998 (nearly for 14 years).
Size of Company
Number of employees: 900 + 150 agency employees during high season
Turnover (in thousands €):
 2011: 201525
 2010: 168888
The known production of electric motors in previous years:
 2007: 7.7 million
 2008: 2.7 million
 2009: 7.6 million
Strength &
Weaknesses
Strengths:
 Being a part of strong multinational group
 Own in-house research and department activities
Notes
The whole production is exported out of Slovakia.
Over 85% of the production goes to the group´s factories, predominantly in Poland, followed by Germany, Spain,
Turkey, Italy and USA.
The company is the largest suppliers of drives for the BSH Group (which includes Bosch, Siemens, Gassenan,
Neff, Thermador, Utesa, Viva and Constructa.
56
|
Weaknesses
 Small number of customers outside BSH group
Halla Climate Control Slovakia s.r.o.
Contact Data
Ul. Ľudovíta Štúra 1033/78, 019 01 Ilava, Slovakia
T: +421 42 4451 930
F: +421 42 4451 820
hccs@visteon.com
www.hccs.sk
Brief Description
The majority shareholder of the company is Visteon group. The manufacturing facility is located in Ilava.
Products
 Production of climatization units for automotive industry.
Time in Market
Since July 2007 (over 5 years of existence).
Size of Company
Number of employees: 500
Turnover (in thousands €):
 2011: 200882
 2010: 171135
Strength &
Weaknesses
Strengths:
 Part of multinational group
Notes
The company produces climatization units for automotive industry, its clients include Kia, Hyundai, Ford, Volvo,
Fiat and Jaguar.
Weaknesses
 Full dependency on automotive industry
Panasonic AVC Networks s.r.o.
Contact Data
Hornádska 80, 053 42 Krompachy, Slovakia
T: +421 53 4180 199
F: +421 53 4180 208
panasonic.avc@gmail.com
www.pavcsk.sk
Brief Description
The Japanese concern Panasonic has two subsidiaries in Slovakia – Panasonic AVC Networks and Panasonic
Electric Devices – both maintain major positions in the Slovak electrical engineering industry. The manufacturing
factory of Panasonic AVC Networks is located in Krompachy.
Products
 Production of DVD players and recorders, Blu-ray players, Blu-ray recorders, HD recorders, Combi
(DVD+VHS) recorders
Time in Market
The company was established in July 2000 (over 12 years of existence).
Size of Company
Number of employees: approximately 900
Turnover (in thousands €):
 2011: 124467
 2010: 145708
Strength &
Weaknesses
Strengths:
 Being a part of strong Japanese concern
Notes
Nearly the whole production is exported out of Slovakia to European markets (the biggest exports markets are
Germany and United Kingdom).
Since February 2010 the company produces 3D Blu-ray recorders for the whole Europe and the Russian Federation.
58
|
Weaknesses
 No export activities outside Europe
Osram a.s.
Contact Data
Komárňanská cesta 7, 940 93 Nové Zámky, Slovakia
T: +421 35 6464 111
F: +421 35 6464 880
osram@osram.sk
www.osram.sk
Brief Description
The parent company of Osram is the German concern Siemens, the biggest player in the sub-sector of lighting
and components. The manufacturing facility is located in Nové Zámky.
Products
 Production of light bulbs, fluorescent bulbs and gas-discharge lights.
Time in Market
From December 2000 (nearly 12 years of existence).
Size of Company
Number of employees: unknown
Turnover (in thousands €):
 2011: 120643
 2010: 108816
Strength &
Weaknesses
Strengths:
Weaknesses
 Being a part of strong German concern
 The company is present in only one sub-sector (as
 Increasing own research and development activities
for production).
 Not dependent only on orders from automotive
industry
Notes
The company benefits from the long-term trend of consumers preferences for new types of energy saving light
bulbs.
In 2009 the company invested 15 million EUR into production of the new types of light bulbs (after the European
Union announced a ban for the old types of light bulbs).
Delta Electronics (Slovakia) s.r.o.
Contact Data
Priemyselná 4600/1, 018 41 Dubnica nad Váhom, Slovakia
T: +421 42 4661 111
F: +421 42 4661 130
dubnica.slovakia@delta-es.com
www.deltaelectronics.sk
Brief Description
The company belongs under the Taiwanese Delta Electronics Group. The manufacturing facility is located in
Dubnica nad Váhom. Originally the company was using manufacturing facilities of other companies, but meanwhile built up its own one.
Products
 Production of solar inverters, power solutions, video walls and LED technology.
Time in Market
Has been acting in Slovakia since 1994, the own production was established in 2001 (nearly 19 years of existance).
Size of Company
Number of employees: approximately 900
Turnover (in thousands €):
 2011: 116361
 2010: 139799
Strength &
Weaknesses
Strengths:
 Being part of international group
 Being active in expanding sector of the industry
Notes
The year 2010 was the most successful in the history of the company so far, due to increase of its business
activities and the boom of photovoltaic market.
The company announced further plans to extend its manufacturing facility, extension of production portfolio and
entering new markets.
There is a possibility that the company will receive governmental investment incentives until the end of the year
2012.
60
|
Weaknesses
 Lack of own finances on further extend of manufacturing facility which is needed
4 Opportunities in Selected MEM Branches
4.1 Machine Tools and Manufacturing Technology
Slovakia has a rather long industrial tradition with mechanical (and later also electrical engineering) industries playing a vital role in it,
which used to contribute to the development and sale of the production of machine tools and manufacturing technology. The first major
crisis hit the sector after the fall of communist regime (from 1989 on) when Slovak producers of machine tools and manufacturing technology gradually started to lose their traditional export markets in other communist countries. Due to lack of experiences and also due to
bad image of products made in communist countries in general, it was difficult for Slovak producers to enter and enforce themselves on
western markets, while on the contrary, western and Asian producers started to gain positions on Slovak market.
The positive moment for the sector was the decision to join the European Union in 2004 and adopting of EUR currency in 2009, which
partially increased the export opportunities for Slovak producers. It also attracted many foreign investors, but it turned out that they prefer
to import their own machine tools and manufacturing technology rather than purchasing it from domestic producers. Until nowadays the
import of machine tools and manufacturing technology is higher than export, although due to global financial and economic crisis none of
them is reaching levels from before year 2008.
According to the latest available information, in the year 2009 if compared to year 2008:
o
the revenues decreased for 42%
o
the export decreased for 42.5%
o
the import decreased for 43%
o
the number of employees decreased for 27% (minus 922 persons)
TABLE 55
Import and export of metal forming machinery (C28.41)
C 28.41
2010
2009
2008
import in thousands EUR
175053
114781
285454
export in thousands EUR
96404
91495
165497
C 28.49
2010
2009
2008
import in thousands EUR
53705
79186
79711
export in thousands EUR
46901
71894
67085
Source: Ministry of Economy of the Slovak Republic
TABLE 56
Import and export of metal forming machinery (C28.49)
Source: Ministry of Economy of the Slovak Republic
Leading companies active in textile machinery production are:
o
MicroStep s.r.o. (Bratislava region)
o
TRENS a.s. (Trenčín region)
o
IMC Slovakia s.r.o. (Trenčín region)
o
LIPTOVSKÉ STROJÁRNE plus a.s. (Žilina region)
o
LVD S2 a.s. (Banská Bystrica region)
o
Remeslo strojal s.r.o. (Banská Bystrica region)
o
IQM s.r.o. (Banská Bystrica region)
o
KABELSCHLEPP-SYSTEMTECHNIK s.r.o. (Nitra region)
o
SLAVIA TOOLS a.s. (Banská Bystrica region)
o
UNICORN – ESK s.r.o. (Banská Bystrica region)
Opportunities for Swiss companies:
 Delivering of components to the local producers of machine tools and manufacturing technology
 Establishing a production or taking over the existing producers of machine tools and manufacturing in Slovakia
4.2 Textile Machinery
The production of textile machinery has a long tradition in Slovakia and is closely connected with the development of the textile industry
as such. The textile industry experienced its first real boom after its nationalisation in 1945 (during the period of Czechoslovakia). The
production of textile machinery (and also development of new techniques and technologies) was fuelled by the reconstruction and construction of new state owned textile manufacturing facilities.
In 1980 there were over 72300 persons working in the textile industry, the production reached the value of 10324.8 million Czechoslovak
crowns and was exported to other communist, capitalist and also to developing countries. But in fact after the fall of communism it turned
out that the textile industry had a low share on GDP creation and high employment versus low productivity of work.
The textile industry experienced its last peak in the period from 1993 to 1997, when it was still employing over 70000 persons. Since this
period the situation was only worsening which was primarily caused by the fact that Slovak market (and also traditional export markets for
Slovak textile production) started to be flooded by cheap Asian textile production (usually of low quality). The domestic textile manufacturing facilities started to vanish, hand in hand with vanishing production of textile machinery as there was a low demand for it.
Nowadays there are basically no research and development activities present in this area and the production of textile machinery is rather
low. According to the latest available information, in the year 2009 if compared to year 2008:
o
the revenues decreased for 35%
o
the value added decreased for 37%
o
the export decreased for 19%
o
the import decreased for 22%
o
the number of employees decreased for 9%
o
only the property value of increased for 20%.
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TABLE 57
Import and export of machinery for textile, apparel and leather production
C 28.94
2010
2009
import in thousands EUR
117.1
76.4
export in thousands EUR
86.4
79.5
Source: Ministry of Economy of the Slovak Republic
Leading companies active in textile machinery production are:
o
STROJCHEM a.s. (Prešov region)
o
B.C.B. s.r.o. (Trnava region)
o
NS ACM s.r.o. (Nitra region)
o
KOVO P+P s.r.o. (Nitra region)
o
VRAMON s.r.o. (Trnava region)
o
RENOZETA s.r.o. (Trenčín region)
Opportunities for Swiss companies:
 Delivering of components to local producers of machinery for textile, apparel and leather production
 Delivering of textile machines for special purposes to Slovak producers (Gore-tex, nanotechnology etc.)
 Establishing a production of machinery for textile, apparel and leather production in Slovakia
4.3 Plastic Machinery
The production of plastic (and rubber) machinery does not have such a long tradition as production of machine tools and manufacturing
technology and textile machinery in Slovakia. This is connected with the fact that this type of production started to develop more significantly only in 70´s and 80´s of last century. After the fall of communist regime in 1989, the face of the industry changed significantly (including the production of plastic and rubber products). Many companies vanished due to opening of the market and import of cheap Asian
production.
In present there are around 1000 companies producing plastic products, the vast majority are small family businesses which own only
one or two plastic machinery machines and produce less sophisticated products. Plus there are few bigger companies producing plastic
components for automotive industry, electrical engineering industry, mechanical industry, producers of electronic home appliances or
construction industry.
The production of plastic and rubber machinery is rather low. According to the latest available information, in the year 2009 if compared to
year 2008:
o
the revenues decreased for 74%
o
the value added decreased for 59%
o
the export decreased for 32%
o
the number of employees decreased for 62% (minus 532 persons)
o
and only the property value of increased for 76%.
Leading companies active in plastic and rubber machinery production are:
o
Manz Slovakia s.r.o. (Trenčín region)
o
VOJUS a.s. (Trenčín region)
o
FOPEX SLOVAKIA s.r.o. (Prešov region)
o
GOMS s.r.o. (Trenčín region)
o
BAAS s.r.o. (Trenčín region)
TABLE 58
Import and export of plastic and rubber machinery
C 28.96
2010
2009
import in thousands EUR
111.6
59.1
export in thousands EUR
165.4
68.6
Source: Ministry of Economy of the Slovak Republic
Opportunities for Swiss companies:
 Delivering of components to local producers of plastic and rubber machinery
 Delivering of plastic and rubber machinery for special purposes to Slovak producers (environment friendly etc.)
 Establishing a production of plastic and rubber machinery in Slovakia
 Establishing a production of plastic components for industries which have a growing tendency in Slovakia (automotive, LCD and LED
televisions etc.)
4.4 Precision Tools
The limited manufacture of precision tools started to disappear in Slovakia from the year 1989 on (end of the communist regime) when
many state companies were privatised, but did not continue in their original manufacturing program or they vanished due to their low
competitiveness on the new open market and loosing of the traditional export markets in other communist countries.
Nowadays there are very few companies present in this area of production - they are mostly Slovak-owned, small-size and were established in early 90´s. Most of them have their own small research and development program, provide services connected with their product
assortments and offer also products from foreign producers.
The leader in C 28.29.3 is Tenzona Bratislava with over 1500 products in its product assortment. Tenzona uses components from wellknown foreign producers such as Mettler-Toledo, Sartorius Mechatronics, HBM, Flintel, KERN or EHP. The company reached its leading
position also thanks to establishing a good position on foreign markets (it exports to the Czech Republic, Ukraine, Poland, Russian Federation and Belarus.
There are more companies selling products of Sartorius Mechatronics, but its official representation is EMCon company (since 1991).
There are 9 manufacturers of weighing machines and scales (C28.29.3; ranked based on revenues):
o
Tenzona Bratislava s.r.o. (Bratislava region)
o
Martes s.r.o. (Žilina region)
o
Pentimex s.r.o. (Trenčín region)
o
EMCon s.r.o. (Bratislava region)
o
WESICO s.r.o. (Trenčín region)
o
ELVA s.r.o. (Prešov region)
o
Granit s.r.o. (Žilina region)
o
GRAVITON s.r.o. (Prešov region)
o
Brutto s.r.o. (Trnava region)
There are 3 manufacturers of parts & accessories of optical appliances and instruments (C26.70.25; ranked based on revenues):
o
Wild Technologies s.r.o. (Trnava region)
o
SAGITTA s.r.o. (Bratislava region)
o
KO-lens s.r.o. (Nitra region)
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There are only data for the whole sub-divisions C 28.29 and C 26.70 available.
TABLE 59
Import and export of other special-purpose machinery
C 28.29
2008
2009
2010
import in thousands EUR
235217
181975
235174
export in thousands EUR
121616
103465
110093
Source: Ministry of Economy of the Slovak Republic
TABLE 60
Import and export of optical instruments and photographic instruments
C 26.70
2008
2009
2010
import in thousands EUR
871342
748039
936175
export in thousands EUR
227500
303288
350016
Source: Ministry of Economy of the Slovak Republic
Opportunities for Swiss companies:
 Delivering of components and products to local producers of precision tools
 Establishing a production of precision tools in Slovakia
4.5 Packaging Technology
Similar as in the case of precision tools, the manufacturing of packaging technology started to disappear in Slovakia from the year 1989
on when many state companies were privatised, but did not continue in their original manufacturing program or they vanished due to their
low competitiveness on the new open market and loosing of the traditional export markets in other communist countries.
The packing machines are mostly classified in C 28.29 category (Manufacture of machinery and equipment for general purposes), but in
fact they partially appear also in C 28.95 (Manufacture of machinery for paper and paperboard) and C 28.96 (Manufacture of machinery
for plastics and rubber), therefore there are no official statistics for packaging technology available.
There are only data for the whole sub-division C 28.29 available.
TABLE 61
Import and export of other special-purpose machinery (C28.29)
C 28.29
2008
2009
2010
import in thousands EUR
235217
181975
235174
export in thousands EUR
121616
103465
110093
Source: Ministry of Economy of the Slovak Republic
According to Ministry of Economy there are 47 companies present in C 28.29.21 area of production, the TOP 10 are (according
to revenues):
o
Manex s.r.o. (Košice region)
o
FROMM Slovakia a.s. (Bratislava region)
o
Heitec s.r.o. (Banská Bystrica region)
o
Manufacturing + Mounting s.r.o. (Banská Bystrica region)
o
Kodreta Štefanov s.r.o. (Trnava region)
o
STAPA s.r.o. (Trenčín region)
o
A.T. Servis a.s. (Trnava region)
o
BEJA and Co. s.r.o. (Trenčín region)
o
Spinkler Design s.r.o. (Trenčín region)
o
Filtrox Technologies (Žilina region)
The production of packaging technology is closely connected with production of packaging materials. The production of packaging materials is large in Slovakia, but especially foreign investors prefer to use technologies imported from abroad.
One of the biggest producers of packaging materials and the biggest producer of glass packaging material is the Swiss company Vetropack (daughter company of Vetropack Holding AG). In 2011 the company´s revenues reached 47.7 million EUR. Vetropack sold 415
million pieces of glass packagings, 48% was exported out of Slovakia.
The opportunities for Swiss companies:
 Delivering of packaging technology and cooperation with Vetropack
 Delivering of innovative packaging technology
 Establishing a production of packaging technology in Slovakia
4.6 Environmental Technology
The quality of environment has a decreasing tendency in general in Slovakia which is mainly a result of the fact that it is a low-priority
area basically for all governments and political parties since the year 1989 (the Green Party is a minor phenomenon in Slovakia). In July
2010 the Ministry of Environment of Slovakia was even cancelled and its agenda shifted under the Ministry of Agriculture, which in Slovak
political conditions represented a major step backwards in environment protection. However, one year later the Ministry of Environment
was re-established again after the change of the government, but the decision-making and policy/regulators making in this area is primarily influenced by the ruling coalition party (SMER-SD) and not by professionals in environment protection.
Some of the most problematic areas of environment protection in Slovakia are:
Implementation of Environmental Impact Assessment (EIA) – EIA was adopted by Slovakia directly in 1994 after the Earth Summit in
Brazil, but its implementation into practise is problematic
Protection of country and landscape – protection of biodiversity, protection of nature reserves (Natura 2000) etc.
Dealing with old environmental burdens and reducing of pollution – there were around 30000 different sources of environment pollution identified in Slovakia, 1100 out of them were classified as highly dangerous for humans and environment. In spite of this critical situation the industrial lobby was successfully blocking the adoption of legislation which would allow to deal with environmental burdens for
nearly 10 years (in order to avoid to finance the environmental burdens created by former state enterprises on industrial sites which were
privatised). However, the legislation was finally adopted in October 2011, although it is not very advanced. Dealing with the most critical
environmental burdens was estimated for 700 million EUR and the plan is to do it partially with a financial support from EU funds.
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Energy production – over 80% of electricity production is produced by nuclear power plants and coal power plants in Slovakia. The
share of renewable energy sources is under 10% and according to the EU regulations Slovakia must increase its share to 14% by 2020
(which is not a very ambitious plan). The main barriers to their further development are the insufficient legislation and the fact that Slovak
electricity market has not been fully liberalized yet (apart from electricity distribution sector).
Problem is also the wasting of energy and energy savings, especially in the industry due to using of old and obsolete technologies, but
also by buildings etc.
The hydro-power represents around 18-20% share on the electricity production in Slovakia. There are few dozens of hydro-power plants
standing on Slovak rivers, the biggest ones (with an operation capacity over 40 MW and yearly production over 140 Gwh) are Čierny Váh,
Gabčíkovo, Liptovská Mara, Mikšová, Žilina, Nosice, Ružín, Považská Bystrica, Králová and Madunice. Slovakia is using especially the
potential of Váh river, with its system of 22 hydro-power plants (plus there is a plan to continue in a construction of small hydro-power
plants), important hydro-power plants are located also on rivers Danube, Orava and Hornád. The hydro-power plants are owned and run
by Slovenské elektrárne / ENEL.
Waste management – Slovakia is performing really well basically only in the electronic waste management area. According to EU regulation Slovakia should collect and recycle 21724 tons of e-waste per year and this was exceeded over 6.5% in 2011 (in spite of decreasing
market with electronic equipment).
As for the rest of waste management, in spite of adopting of numerous EU regulations regarding waste and waste management, and
receiving financial aid for this area for over 20 years, Slovakia has more communal waste in its storages than Germany, Netherlands,
Belgium, Denmark, Sweden and Austria together, which is an alarming situation. There are three main reasons causing this situation: 1)
due to the weak legislation it is the cheapest way of waste storage, 2) bad results when it comes to waste recycling and 3) insufficient
capacities for energy recovery of communal waste. Also, a long-term trend is higher import of waste instead of its export out of the country.
Slovakia has 2 waste incineration plants with a capacity over 2 tons per hour for communal waste (OLO Bratislava and Kosit Kosice) and
2 for industrial waste (Slovnaft Bratislava and Duslo Šaľa). There are also 5 smaller waste incineration plants with a capacity under 2 tons
per hour (Železničné opravovne a strojárne Zvolen, Chemko Light Stabilizers Strážske, Fecupral Poprad, A.S.A. Slovensko Kysucké
Nové Mesto and Spaľovňa odpadov OLO Liptovský Mikuláš) plus 5 smaller unspecified plants.
In 2008 Slovakia had slightly over 600 sewage purification plants, in 2009 it was just under 600. Due to gradual construction of urban
sewage purification and drinking water treatment plants, the water pollution has a decreasing tendency in Slovakia. While until year 1998
the dominant source of water pollution was public waste-water canalization, after 1998 the dominant source became industrial activities
(while it is not possible to evaluate the impact of agricultural activities properly).
The opportunities for Swiss companies:
 In renewable energy sources sector to invest especially into wind power-plants, technologies of combined production of electricity,
heat and cold by biomass or biogas, smaller size photovoltaics systems designed for private individual users and companies
 Import, sale and service of systems and components for low-energy, passive and intelligent buildings
 New technologies of wastewater treatment (removal of nitrogen, phosphorus, drugs and aggressive cleaning products)
 New technologies for the use of sludge from wastewater treatment plants (biogas, reclamation, incineration)
 More advanced technologies for recycling of plastics, paper, glass and metals
 Environment friendly technologies for energy recovery of communal waste (incinerators)
 Advanced filtration technology for large sources of pollution
5 Regulatory and Institutional Background
5.1 Regulations & Regulatory Authorities
The legislation connected with activities of Mechanical and Electrical Engineering belongs under Ministry of Economy of the Slovak Republic:
Ministerstvo hospodárstva SR / Ministry of Economy of the Slovak Republic
Mierová 19, 827 15 Bratislava 212, Slovakia
Tel.: +421 2 4854 111
Fax: +421 2 4333 7827
Email: info@mhsr.sk
Website: www.economy.gov.sk
5.2 Professional organizations
Podnikateľská aliancia Slovenska – PAS / Business Alliance of Slovakia
Bajkalská 25, 827 18 Bratislava 212, Slovakia
Tel.: +421 2 5823 3481
Fax: +421 2 5823 3487
Email: pas@alianciapas.sk
Website: www.alianciapas.sk
Združenie podnikateľov Slovenska – ZPS / Enterpreneurs Association of Slovakia
Cukrová 14, 813 39 Bratislava, Slovakia
Tel.: +421 2 5932 4344
Fax: +421 2 5932 4343
Email: zps@zps.sk
Website: www.zps.sk
Asociácia strojárskeho a elektrotechnického priemyslu – ASEP / Association of Mechanical and Electrotechnical Industry
Digital Park II, Einsteinová 23, 851 01 Bratislava, Slovakia
Tel.: +421 2 3301 4283
Fax: n/a
Email: asep@asep-sr.sk
Website: www.asep-sr.sk
Zväz strojárskeho priemyslu SR – ZSP SR / Federation of Mechanical Engineering of the Slovak Republic
Tomášikova 30, 821 01 Bratislava, Slovakia
Tel.: +421 2 4342 7283
Fax: +421 2 4333 0557
Email: zspsr@zspsr.sk
Website: www.zspsr.sk
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Zväz elektrotechnického priemyslu SR – ZEP SR / Association of Electro-technical Industry of the Slovak Republic
Kominárska 2/4, 831 04 Bratislava, Slovakia
Tel.: +421 2 5023 4259
Fax: +421 2 5023 4507
Email: zep@zep.sk
Website: www.zep.sk
Elektrotechnický ústav SAV / Institute of Electrical Engineering, Slovak Academy of Sciences
Dúbravská cesta 9, 841 04 Bratislava, Slovakia
Tel.: +421 2 5922 2468
Fax: +421 2 5477 5816
Email: elusav@savba.sk
Website: www.elu.sav.sk
Ústav materiálov a mechaniky strojov SAV / Institute of Materials and Machine Mechanics, Slovak Academy of Sciences
Dúbravská cesta 9, 841 04 Bratislava, Slovakia
Tel.: +421 2 5922 2468
Fax: +421 2 5477 5816
Email: elusav@savba.sk
Website: www.elu.sav.sk
EKOLAMP Slovakia – Združenie výrobcov a distribútorov svetelnej techniky / EKOLAMP Slovakia – Association of Producers
and Distributors of Electric Lighting Equipment
Turecká ulica 37, 940 01 Nové Zámky, Slovakia
Tel.: +421 35 6445 447
Fax: +421 35 6448 212
Email: ekolamp.sk@ekolamp.sk
Website: www.ekolamp.sk
ENVIDOM – Združenie výrobcov elektrospotrebičov pre recykláciu / ENVIDOM – Association of Producers of Electric Domestic
Appliances for Recyckling
Ružová dolina 6, 821 08 Bratislava, Slovakia
Tel.: +421 2 5022 1300
Fax: +421 2 5022 1301
Email: info@envidom.sk
Website: www.envidom.sk
6 Conclusions & Recommendations
Investment incentive policy
There are two important moments regarding the Slovak investment incentive policy which may endanger the changes of Swiss investors
to receive this kind of governmental help if entering the Slovak market.
At the beginning of year 2012, Slovakia altered its investment policy and it is not that flexible as it used to be in the previous years and it
was also announced that the value of incentives will be lower. The investment incentives granted to investors will depend on the unemployment rate in the region in which the investor wants to settle down and the sectors of operation with a higher added value will be preferred. On the other hand, the positive points are the prolonging of the duration of tax holidays and the reduction of the required minimal
investment level, which will enable also investment activities of smaller-sized and medium-sized enterprises to be supported, not only
large-scale projects of large companies. The four areas where it is possible to receive the investment help include industrial production,
technological centers, shared service centers and tourism.
During this year a group of investors asked for governmental incentives in a value of 101.07 million EUR, the result/approval of Ministry of
Economy and the Slovak government was not known yet during the time of writing of this report. The investors are namely asking for tax
reliefs and it is the following companies: Delta Electronics, Fagor Ederlan Slovensko, Ekoltech, Muehlbauer Technologies, Bekaert Slovakia, Mondi SCP, Magnetti Marelli Slovakia, Continental Automotive Systems and Samsung Electronics Slovakia. There are three major
players of electrical engineering sector among them: Samsung Electonics Slovakia, Delta Electronics and Magnetti Marelli Slovakia.
In the case of an approval of this investment help the chance of other companies to receive investment incentives in upcoming period of
one or two years will be low. It is also necessary to point out that the approval process is extensively long in general in Slovakia (standard
is between 4 and 5 months and even more).
The main reasons for investing in Slovakia would be especially its strategic geographic location in the central Europe, political and economic stability, steadily developing infrastructure and large selection of industrial land and offices available for purchase, rent etc.
Economic and Business environment
The advantage of Slovakia as an investment destination for Swiss companies compared to Czech Republic and Hungary is that it is the
most open economy, it has 20% flat tax rate (apart from few exception as is the lower tax rate for medicines or books) and it adopted
EUR currency from 1st of January 2009. There are also very few restrictions on foreign ownership and no limitation on the free flow of
capital.
Compared to neighboring Czech Republic and Hungary, Slovakia is economically powering ahead. The GDP growth is fueled by export,
investments and outperformance of automotive industry and production of electrical equipment. According to IMF the economy is expected to continue to grow at healthy pace and inflationary processes are expected to ease.
On the other hand, the business environment has a slightly worsening tendency. In 2012 Slovakia improved its Economic Freedom Index,
but fell lower in the competitiveness ranking and in Doing Business 2012 prepared by IBRD/The World Bank it received 48 points which is
5 points less than in 2011.
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Mechanical engineering sector
The future market challenges:
o
changes related to new markets
o
strengthening competition of emerging countries (China, Brazil, India, Russian Federation, countries of Southeast
Asia)
o
demographic changes
o
changes connected with progressing climate changes
o
changes in distribution chain structure
o
new demand and requests of customers
o
shortening of innovation cycles
o
implementation of new technologies
o
lowering the production costs
The future market opportunities:
o
development of information technologies
o
stronger orientation on more sophisticated production
o
actual small share of high-technology (according to European Innovation Scoreboard classification)
o
insufficient use of local raw materials in present
o
using of available free capacities (industrial parks and objects with good infrastructure, qualified workforce, research
and development base etc.)
o
research and development activities which are lacking behind and are not properly interfaced together
o
production of components for automotive industry (the automotive industry prefers to use its manufacturing capacities
for different purposes and prefers to commit the production of parts to external contractors)
o
diversification of production
Electrical engineering sector
The future market challenges:
o
lowering of the production costs
o
increasing automation of automotive industry and its need for hardware and software (of production systems)
o
continuing dependency on automotive industry
o
changes in distribution chain structure
o
new demand and requests of customers
o
shortening of innovation cycles
The future market opportunities:
o
further development of automotive sector which would represent new possibilities for components producers
o
orientation on more sophisticated research and production
o
building up of customer service centers for manufacturing facilities located in Slovakia
o
full liberalization of the energy market, construction and upgrading of energy infrastructure
o
to relocate consulting IT companies to Slovakia
o
building up of logistic centers in Slovakia
The opportunities for Swiss companies in selected MEM branches
The opportunities are mainly in:
o
delivering of components to various local producers
o
establishing/shifting production to Slovakia
o
taking over existing local Slovak-owned companies with good business perspectives
o
importing innovative and high-quality Swiss technology to Slovakia (in all selected branches except of plastic machinery is the import higher than export because foreign investors usually prefer to use technology from abroad)
Mechanical engineering and electrical engineering sector – threats and weaknesses
The weaknesses:
o
o
o
o
high share of manual work in production and low level of automation
lack of qualified labour force in some professions (especially university graduates)
weak innovation ability
growing influence of automotive industry (narrow specialization)
The threats:
o
o
o
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loss of competitiveness of sectors
growth of prices of commodities such as energy, steel and wages in economy
growing lack of qualified work force
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