Holecek: Slovakia Unlikely to End Up Like Detroit

(Stock photo by TASR)

Bratislava, February 16 (TASR) – Car production makes up one-third of Slovakia’s exports and almost half of its industrial production, but there’s no viable alternative to the automotive industry in the country, Automotive Industry Association vice-president Jaroslav Holecek told TABLET.TV on Thursday.

“We haven’t managed in 25 years to create a different industry sector to pull Slovakia up. Many suppliers [for the sector] have also come, creating a competitive advantage [compared to other countries] in attracting further carmakers. Nevertheless, Slovakia should consider creating conditions for keeping them here forever,” said Holecek.

Working at their full capacities, the three car plants in Slovakia (Volkswagen, Peugeot-Citroen and Kia) combined have been producing 1 million cars annually in the past two years, with the figure even due to grow in the next few years to about 1.3 million following Jaguar Land Rover’s investment in Nitra.

At the same time Holecek believes that there’s still room for another carmaker, for example for the production of lorries, but this investment should be placed to the east from Zilina and Banska Bystrica.

Despite Slovakia’s significant dependence on the car sector, the country isn’t likely to face the same fate as Detroit and Belgium, which both were among the global top producers a mere two decades ago, thinks Holecek.

“There was a problem with the labour force in Belgium. After it became the centre of the EU, personnel costs increased enormously, with carmakers being unable to endure the situation anymore. Conversely, Detroit had an excellent outlook, having established many automotive producers, but it eventually suffered from the lack of a skilled labour force. We realise this in Slovakia,” said Holecek, adding that Slovakia will need 14,000 new staff for the car sector in the next three years.

The school system, however, is currently able to produce only one-third of that figure.

“We’ll need to import around 5,000 employees from other countries before we can produce our own labour force. Detroit fell partly because it began importing a labour force with poor skills. We don’t want to end up like that. So, we expect the Labour, Social Affairs and the Family Ministry to begin making employed people out of the unemployed. As many as 70,000 people could be retrained, as they have obviously erred in their vocation. This mostly concerns school graduates,” said Holecek, adding that dual education is another partial solution to deal with the situation.