A look at foreign investments in the car-making industry in Romania.
The German car consortium Daimler has made a big investment worth more than 300 million euros in Sebes, in the central county of Alba. They invested in a factory for the assembly of state-of-the-art 9-speed automatic transmission systems, which are mounted on 20 Mercedes models sold in some 200 countries. The thus investors created 500 new jobs in the town of Sebes, the Daimler consortium having a total of 2,300 employees in Romania, as it also has a factory in Cugir.
Bernd Krottmayer is the representative of the German consortium: “Our success story started on a gloomy winter day back in 2001. There was a call for projects in which over 70 companies from Romania were competing to work with Daimler. The Cugir Mechanical Plant was the winner and this is how a joint venture was set up. Both partners’ know-how with regard to producing gear wheels and metal processing was the secret ingredient of this success story. At the Joint Venture Star Transmission Cugir we wanted to produce, on long term, complete assemblies, but this happened only 12 years later. The company’s objective was to build a 2nd production hall and to increase the number of employees up to a maximum of 500. Those targets became soon outdated. In 2004 a second production hall was built and in 2010 a second work unit was opened in Sebes. In 2013 the company had more than 1,000 employees and our biggest dream came true: we started the serial assembly of transmission systems at Star Transmission.”
An assembly line for double-clutch gearboxes to fit Mercedes cars, a roughly 40 million-euro investment, was officially inaugurated in early 2014. Also a production unit for gearboxes to equip the 9G Tronic model has recently been inaugurated.
Bernd Krottmayer: “Besides many other accomplishments, we’ve taken another major step forward in terms of the young people’s training. We have inaugurated a dual vocational school in Alba, according to the German model, where together with other companies in the county, we are getting involved in the vocational and technical training of the young generation. Due to the population aging and the demographic evolution, it’s very difficult to find technically skilled professionals. And it’s important to use modern methods to train young technicians who could better meet a company’s requirements.”
Such investments are of good omen, says Deputy Prime Minister Costin Borc while attending the inauguration of the factory in Sebes: “This is an extraordinary thing, because we speak of a high-tech product and fresh jobs for highly-skilled professionals. As I’ve repeatedly said, the Romanian government is committed to reindustrializing the country and for that we need skilled labour. We are talking here about the development vocational education, the involvement of the local communities in ensuring the right conditions to foreign investors.”
Romania’s auto parts industry saw an impressive boom after 1999, when Renault took over the local carmaker Automobile Dacia, based in Mioveni, southern Romania. Since then, a series of traditional providers for Renault have invested in the local market, including Auto Chassis International, Valeo, Euro APS, Johnson Controls, Autoliv of Sweden, Inergy of France, Euralcom, Michelin and Continental. The Romanian providers equipping Dacia cars include Elba from Timisoara, producing parts for the cars’ lighting systems, Autonova from Satu Mare, manufacturing brakes, Rombat Bistrita, a car batteries supplier and UAMT Oradea, supplying rear view mirrors, sunshades and wiper blades.
After US carmaker Ford had taken over the local producer in Craiova, south-western Romania, suppliers of the US company have also made major investments in this country, such as Johnson Controls, Bamesa, Kirchhoff Automotive, Leoni Wiring Systems and Gestamp Automocion. Other producers, such as Faurecia and the car rims producer Magnetto Wheels Romania, which had already been on the market also became Ford suppliers. Major German investments have been placed in western and central Romania by companies like the Continental Group, Bosch, Lisa Draexlmaier, Kuhnke Relee, BOS, Siemens, TMD Friction, Benteler, Optibelt, Schneider & Oechsler, Hella Lighting and Stabilus. Japanese companies like Calsonic Kansei, Yazaki and Sumitomo have also made major investments in Ploiesti, southern Romania, in Alba Iulia, Deva and Orastie, in central and western Romania.
However, foreign investors in the car-making industry have often called for the improvement of road infrastructure, mainly lobbying for the construction of a Trans-Carpathian motorway linking the cities of Pitesti and Sibiu, which would significantly reduce costs. Dacia employees even took to the streets of Bucharest in early March demanding that works at the aforementioned highway be stepped up. The National Road Company in Romania pledged that a feasibility survey for the motorway would be completed by December 15th, while the real design and construction would start shortly after the survey was completed. The first motorway segment is estimated to become operational in 2021.