THE AUTOMOTIVE AND CONSTRUCTION EQUIPMENT INDUSTRY SLOVENIA Fact Pack

1
THE AUTOMOTIVE AND CONSTRUCTION EQUIPMENT
INDUSTRY SLOVENIAFact Pack

• Swedish Trade Council in Austria
• 2006

2
CONTENT

• Overview Slovenian Manufacturing Industry
• Slovenian Automotive Industry
• Slovenian Construction Equipment Industry
• Recommendations

3
THE MANUFACTURING INDUSTRY IN SLOVENIA AND HAS
GROWN WITH 40 SINCE 2000 - Automotive the 5th
largest manufacturing segment

• The total turnover of the Slovenian manufacturing
  industry equalled SEK 180 billion in 2004
• There are 18,269 companies in the manufacturing
  industry and 86 in automotive segment in Slovenia
  
• 244,380 are employed in manufacturing
• 24,500 people are employed in the whole
  automotive industry section (vehicles parts)
• Automotive is the 5th largest manufacturing
  segment in Slovenia (SEK 14,9 Billion, 2004)
• The average labor cost for industry workers in
  the Slovenian automotive segment is SEK 73 per
  hour

5 largest manufacturing industries in Slovenia
Metal products (except machinery)
Chemical
Machinery and Equipment
Food
Automotive
0
10
20
30
Billion SEK
The automotive industry amount 7.9 of the total
manufacturing industry
Calculated on average monthly salary in
Slovenian automotive sector SEK 10.061, 160
h/month, 16.1 in social fees
Source Statistic Slovenia, TIPO Slovenia
4
CONTENT

• Overview Slovenian Manufacturing Industry
• Slovenian Automotive Industry
• Passenger Cars
• Commercial Vehicles
• Other Vehicles
• Suppliers
• Slovenian Construction Equipment Industry
• Recommendations

5
THE SLOVENIAN PRODUCTION OF CARS AND COMMERCIAL
VEHICLES TOTALS SEK 14,9 BILLION- the industry
grew more than 20 in 2004
Production cars and commercial vehicles industry
in Slovenia
billion SEK
Motor vehicle- engine parts SEK 4,1 billion
Motor vehicles SEK 8,4 billion
Vehicle bodies etc. SEK 2,3 billion
Motor vehicles most important segment within
Slovenian automotive industry
Source ACS Automotive Cluster Slovenia
Exchange rate SIT to SEK 0,03882 (Oanda
FXtrade)
6
THE AUTOMOTIVE INDUSTRY IN SLOVENIA SHOWS SIGNS
OF HIGH VOLATILITY - Decreased in 1999 (- 8,2
), increased heavily in 2004 ( 21 )

• Growth during 2000-2004
• Automotive industry ? 33,0
• The whole manufacturing industry ? 39,6
• The automotive segment is more volatile then the
  manufacturing industry in general
• From 1996-2004 Manufacturing segment grew
  annually with 4,7 - 24,8 - Automotive with
  between (-8,2) - 31,8
• The Slovenian automotive segment is very
  dependent on Renault Revoz (the only OEM of cars
  in Slovenia) and the German market
• Changes in Renault Revozs annual sales and in
  the whole automotive sector from 1998-2004
  correlates
• Renault Revoz accounts for 54,4 of the whole
  Slovenian automotive segment (2004)
• The future prospects for the Slovenian automotive
  industry is related to the success of Renault
  Revoz
• Germany the main market for automotive suppliers

Automotive Industry - Yearly Development 1995-2004
? in
billion SEK (Automotive)
The Slovenian automotive industry is very
dependent on Renault Revoz
Source Statistic Slovenia, ORBIS
7
ABOUT 178 000 VEHICLES ARE PRODUCED IN SLOVENIA-
177 945 passenger cars and ca. 120 commercial
vehicles
VEHICLE MANUFACTURERS
COMMERCIAL VEHICLES (120 vehicles)
LIGHT TRUCKS (0 vehicles)
BUSES (101 vehicles)
HEAVY TRUCKS (15 vehicles)
PASSENGER CARS (177,945 vehicles)

• (Weight lt 6 t)
• N.a.

• 1 manufacturer
• TVM (101)
• Tourist coach/City-liner (TAM)
• Mini- Midi buses (MARBUS)
• Airport coaches (NEOPLAN)

• (Weight gt 6 t)
• 1 manufacturer
• TVM (15) 9t trucks (TAM)

• 1 manufacturer
• Renault Revoz d.d. (177,945)
• Clio II

Source OICA WEB SITE , www.oica.net, ACS -
Automotive Cluster Slovenia, Statistic Slovenia
8
CONTENT

• Overview Slovenian Manufacturing Industry
• Slovenian Automotive Industry
• Passenger Cars
• Commercial Vehicles
• Other Vehicles
• Suppliers
• Slovenian Construction Equipment Industry
• Recommendations

9
THE PASSENGER CAR PRODUCTION IN SLOVENIA IS
LIMITED- Revoz (Renault) the only Slovenian OEM
in this segment
Passenger Car Production in Slovenia
Development the last 5 years

• Renault was established in Slovenia in 1972, as
  they started to cooperate with IMV (Industry of
  Motor Vehicles)
• The company Revoz was founded in 1989 as a JV
  between Renault and IMV
• In 2003, Renault bought the rest of the shares to
  become the sole owner of Revoz
• Production of the Clio model started in 1993 and
  is since 1996, the only model produced in Novo
  Mesto
• In 2005, the French company Flins ceased to
  produce Clio II and Revoz became the only
  remaining company producing Clio II for the
  European market ? production increased further
• In the first half of 2006, Revoz produced 10
  less compared with same period for 2005. Revoz
  still expects higher demand for the Clio models
  in the future
• Revoz will start to produce a new car, Renault
  X44, during 2007

Vehicles
Source Renault Revoz
10
THE MAJORITY OF PURCHASE DECISIONS ARE MADE IN
FRANCE FOR RENAULT REVOZ BY A SLOVENIAN MANAGER
Passenger Cars
11
THERE IS ONLY ONE CAR MANUFACTURING PLANT IN
SLOVENIA- Renault Revoz d.d. is the biggest
Slovenian exporter

• Renault Revoz d.d.s facility in Novo mesto is
  the only car manufacturing plant in Slovenia
• 95 of the total production ( 10 of Slovenias
  total export) is exported foremost to France,
  Germany and Italy
• Owned to 100 by Renault s.a.s
• Future ? Revoz plant will focus on the production
  of the new X44 model (2007)
• Key figures 2005
• Production 177,945 (Renault Clio)
• Revenues SEK 10,579 Bn.
• Net profit SEK 340 Mio.
• Export SEK 10,232 Bn.
• Workforce 2,621 people

Novo mesto
Source Revoz, Novo mesto
12
CONTENT

• Overview Slovenian Manufacturing Industry
• Slovenian Automotive Industry
• Passenger Cars
• Commercial Vehicles
• Other Vehicles
• Suppliers
• Slovenian Construction Equipment Industry
• Recommendations

13
RISING DEMAND OF BUSES LIFTS COMMERCIAL VEHICLE
SEGMENT- TVM is one of two producers of airport
buses in the world
Commercial Vehicle Production in Slovenia
Development the last 5 years

• The production of commercial vehicles in Slovenia
  is very limited as only one OEM company is
  present in this segment
• Production of buses increased after TVM signed a
  contract to produce airport buses for the German
  company NEOPLAN (M.A.N.)
• TVM was facing serious financial problems before
  Viator Vector became the main shareholder (98)
  of the company and invested more than 6 Mio. in
  TVM.

Vehicles
Note estimated from articles as data is not
available
14
THE MAJORITY OF PURCHASE DECISIONS ARE MADE IN
SLOVENIA FOR TVM
Commercial Vehicles
15
TVM (COMMERCIAL VEHICLES) IS SITUATED IN MARIBOR
IN THE NORTHEAST OF SLOVENIA

• Since 1991 TVM (Tovarna Vozil Maribor d.o.o.)
• Before 1991 TAM (Automobile and Engine Factory
  Maribor)
• Owned by Viator-Vector group
• Manufactures buses and trucks under the brands
• Used to assembly Holder Tractors until 2005
• Assemblies airport buses for NEOPLAN (M.A.N.)
• Tries to penetrate the Scandinavian market with
  mini buses (MARBUS) through new Swedish partner
• Key figures 2004
• Production 120 Vehicles

Maribor
Source TVM
16
CONTENT

• Overview Slovenian Manufacturing Industry
• Slovenian Automotive Industry
• Passenger Cars
• Commercial Vehicles
• Other Vehicles
• Suppliers
• Slovenian Construction Equipment Industry
• Recommendations

17
ADRIA-MOBIL RANKS 6TH AMONG THE MOST SUCCESSFUL
PRODUCERS OF CARAVANS AND MOTORHOMES IN EUROPE -
Exports 99 of all products to West Europe

• Ownership structure
• The company belongs to the ADRIA group
• Production
• Production of bodywork for vehicles, production
  of caravans and half-caravans
• International sales
• Markets the basic caravans and motorhomes under
  the brandnames ADRIA and ADRIATIK
• Export to the West European markets amounts for
  99 of the total turnover and the products are
  sold in the markets from Scandinavia to Greece.
• ADRIA has a 6,5 share of the European market
• Key figures 2004
• Production n.a.
• Revenues SEK 1,986.9 Mio.
• Net profit SEK 966.6 Mio.
• EBIT SEK 1,421.7 Mio.
• Export SEK 1,857.6 Mio.
• Workforce 717 people

Novo mesto
18
SISTEMSKA TEHNIKA D.O.O. IS A MAJOR PLAYER IN THE
DEFENSE EQUIPMENT SEGMENT- Manufacturer of
different kinds of army vehicles

• Ownership structure
• - VIATOR VEKTOR, 70,5
• - Steyr Daimler Puch, 17,5
• - D.P.R., druba pooblacenka Ravne, 12,0
• Production
• Technological Equipment
• Component parts, sub-assemblies and equipment
  for metallurgical, power, transport industries
  and mechanical engineering
• Defense Equipment
• Light armoured vehicle (LAV) Valuk 6x6, Infantry
  fighting vehicle (IFV) Krpan 8x8, Armour System,
  Artillery Weapon Parts
• Key figures 2004
• Production N.a.
• Revenues SEK 247.6 Mio.
• Net profit SEK 3.7 Mio.
• EBIT SEK 4.4 Mio.
• Export SEK 35.0 Mio.

Ravne Na Koroskem
Source STC research
19
TOMOS IS A PRODUCER OF MOPEDS, RACING MOTORCYCLES
AND MOTORCYCLE COMPONENTS- A large part of the
production is exported to Europe and US

• Established in 1954 in Koper, Slovenia
• 1 of 4 companies in the Hidria Corporation
• Subsidiaries Tomos US Tomos Nederland
• Export to foremost Europe US amounts for a
  large part of total sales
• Co-operates with BMW Motorbikes
• Key figures 2004
• Production 29,000 Vehicles (mopeds)
• Revenues SEK 361.9 Mio.
• Net profit SEK 1.4 Mio.
• EBIT SEK 0.49 Mio.
• Export SEK 265.1 Mio.
• Workforce 319 people

Koper
Source STC research
20
ITAS CAS D.O.O. PRODUCES SANITARY VEHICLES-
Partners up with INTERMIX from Germany for the
European market

• INTERMIX (www.intermix.de) from Germany is a key
  partner for ITAS-CAS on the West-European market.
• In 1990 ITAS split up into the independent
  companies ITAS-CAS d.o.o. and ITAS-PTI d.o.o.
• Trailers, semi-trailers, and superstructures for
  different proposals are basic production program
  of ITAS-PTI.
• Key figures ITAS-CAS 2005
• Production 1000 concrete-mixers, 10
  tank-trailers
• Revenues SEK 82.37 Mio.
• Net profit SEK 8 Mio.
• Export SEK n.a. Mio.
• Workforce 77
• Key figures ITAS-PTI 2005
• Production 25 superstructures, 53 underframes
  for trailors, 39 trailers semitrailors
• Revenues SEK 20.42 Mio.
• Net profit SEK 50,000
• Export SEK n.a. Mio.
• Workforce 29

Kocevje
Source STC research
21
LIMB D.O.O. IS A NEW SLOVENIAN TRACTOR PRODUCER-
SAVA Tires owns 37.5 of the company

• Established in 2003 in Ptuj, Slovenia
• Company started with serial production in 2005
• Tractor LIMB 80TLS was rewarded with a quality
  award on Slovenian agricultural fair in Gornja
  Radgona in 2004 and 2005
• Key figures 2005
• Production n.a. (Plan 2005 300 tractors)
• Revenues SEK 18.36 Mio.
• Net profit SEK 7.4 Mio.
• Export n.a.
• Workforce 25

Ptuj
Source STC research
22
CONTENT

• Overview Slovenian Manufacturing Industry
• Slovenian Automotive Industry
• Passenger Cars
• Commercial Vehicles
• Other Vehicles
• Suppliers
• Slovenian Construction Equipment Industry

23
THERE ARE CA. 85 AUTOMOTIVE SUPPLIERS IN
SLOVENIA- Slovenian suppliers has strong ties
with German market
Geographical concentration of automotive
suppliers
Slovenian automotive suppliers

• Slovenia has only two OEM companies but many T1
  T2 suppliers, of which a few are well recognised
  on the global automotive market
• A few well-known international suppliers has
  their subsidiaries in Slovenia
• Suppliers of Slovenia differ in size from 30
  2500 employees
• The majority of the Slovenian suppliers (65 )
  are member in the Automotive Cluster of Slovenia
  associate
• Suppliers with long traditions in manufacturing
  are found in almost all segments of production

Suppliers are located all over the country
24
THERE ARE EIGHT T1 SUPPLIERS LOCATED IN
SLOVENIA- Iskra Avtoelektrika is one of the
largest T1 supplier in Slovenia with annual sales
of 165,5 Mio. and 1,583 employees (2005)
T1 SUPPLIERS
Electrical systems
Interior equipment
Propulsion
Body
Running gear

• Cables, bus systems, embedded systems
• Iskra Avtoelektrika

• Power train, exhaust systems, engines
• AET
• CIMOS
• GOODYEAR EPE

• Cockpit, seats, dash-board, air conditioning
• TPV
• TCG Unitech LTH

• Body, roof, glass, doors, lighting etc.
• HELLA
• TPV

• Suspension, brakes, axles, steering, tires
• CIMOS
• TBP
• SAVA TIRES
• TCG Unitech LTH

Source ACS Automotive Cluster Slovenia, STC
research
25
ALMOST ALL PURCHASE DECISIONS ARE MADE IN
SLOVENIA- Only Hella Lux has HQ located in
another country (Germany)
Source ACS Automotive Cluster Slovenia
26
ALMOST ALL PURCHASE DECISIONS ARE MADE IN
SLOVENIA- Hella Lux, SAVA Tires and TCG Unitech
are not members of ACS
Source ACS Automotive Cluster Slovenia
ACS Automotive Cluster Slovenia
27
THE T1 SUPPLIERS ARE LOCATED NEAR THE COASTS OR
NEAR THE VEHICLE OEMs- T1 suppliers in Slovenia
often functions as hubs for Balkan
Lenart
Tolmin
Kranj
Ljubljana
kofja Loka
Polje
Novo mesto
Koper
Source Internet, ORBIS, ACS
28
THERE ARE MORE THAN 50 T2 SUPPLIERS LOCATED IN
SLOVENIA- Slovenia has only two OEMs but many
T1- and T2 suppliers
T2 SUPPLIERS
Electrical systems
Interior equipment
Propulsion
Body
Running gear

• Cables, bus systems, embedded systems
• Domel
• Elvez
• Iskra EMS
• Iskra Mehanizmi d.d.
• KGL
• Rotomatika
• TAB

• Power train, exhaust systems, engines
• Cimos
• Iskra Avtoelektrika
• KGL
• KLS
• Rotomatika
• TCH Unitech
• Unior
• Sogefi Filtration

• Cockpit, seats, dash-board, air conditioning
• Agis Plus
• Grammer
• Johnson Controls NTU
• Kovinoplastika
• LIV
• Polycom
• Prevent
• TT Okroglica

• Body, roof, glass, doors, lighting etc.
• Cimos
• Helios
• Karoserije
• KGL
• Kovinoplastika
• Presek
• Sava GTI
• SEP
• TKG
• TPV

• Suspension, brakes, axles, steering, tires
• Agis Zavore
• GKN Driveline
• Iskra Avtoelektrika
• Rotomatika
• TALUM
• Unior

Source ACS Automotive Cluster of Slovenia, STC
research
29
MOST OF THE PURCHASE DECISIONS ARE MADE IN
SLOVENIA- Some important international suppliers
have subsidiaries in Slovenia
Source ACS Automotive Cluster Slovenia
30
HELIOS HAS PRODUCED FOR OEMs FOR THE LAST 25
YEARS - Today the company is one of the biggest
T2 suppliers in Slovenia
Source ACS Automotive Cluster Slovenia
31
THE COMPANY KAROSERIJE IS ONE OF TAMS SUCCESSORS
- TAM used to be a big OEM producer of buses and
trucks in Slovenia
Source ACS Automotive Cluster Slovenia
32
PREVENT IS AN IMPORTANT EUROPEAN CAR SEAT
PRODUCER - More than 2 million car seat covers
are produced annually
Source ACS Automotive Cluster Slovenia
33
TPV IS BUILDING A FACTORY IN KRAGUJEVAC, SRBIA-
UNIOR d.d. is one of the biggest T2 suppliers in
Slovenia
Source ACS Automotive Cluster Slovenia
34
THE T2 SUPPLIERS ARE LOCATED ALL AROUND
SLOVENIA- Automotive suppliers in Slovenia are
focusing on global markets
Maribor
Kidricevo
Meica
Slovenj Gradec
Ptuj
Zrece
Selca
Celje
Ljubno
Kopra
Domale
Ljubljana
empeter v Savinjski dolini
elezniki
kofljica
Spodnja Idrija
Litija
kofja Loka
Novo mesto
entjernej
Postojna
Stari trg pri Lou
Source Internet, ORBIS
35
SLOVENIAN T1- AND T2 SUPPLIERS ARE INTENSIFYING
THEIR RD ACTIVITIES
Trends within Slovenian OEMs, T1- T2 suppliers

• Slovenian automotive companies often functions as
  hub for the Balkans countries
• Aiming to optimize the production through
  outsourcing to LCCs Serbia and Bosnia, where cost
  for labour are only 20 of the Slovenian labour
  costs
• Current focus for many companies is the
  development of a supplier base in East Asia

Globalization

• Increased competition and continues price
  reductions, above all within the small and medium
  car segment
• The Slovenian companies are competing on a global
  basis in global tenders
• Normal pressure for annual price reduction of
  5-10

Competition and price reductions

• T1 T2 suppliers are aiming to climb in the
  value-chain
• More RD is being carried out by the suppliers
• GOODYEAR has for example their European
  Competence Centre (RD) in Slovenia

RD-displacement
Source ACS Automotive Cluster Slovenia STC
Austria
36
CONTENT

• Overview Slovenian Manufacturing Industry
• Slovenian Automotive Industry
• Slovenian Construction Equipment Industry
• Manufacturers
• Suppliers
• Recommendations

37
THERE ARE NO OEMs IN THE CONSTRUCTION EQUIPMENT
SEGMENT SITUATED IN SLOVENIA
Source ACS Automotive Cluster Slovenia
38
CONTENT

• Overview Slovenian Manufacturing Industry
• Slovenian Automotive Industry
• Slovenian Construction Equipment Industry
• Manufacturers
• Suppliers
• Recommendations

39
THERE IS ONLY A FEW SLOVENIAN T1 T2 SUPPLIERS
IN THE CONSTRUCTION EQUIPMENT SEGMENT- ADK is
ISO 9001 certificated and has Liebherr as main
customer
SUPPLIERS
Electrical systems
Interior equipment
Propulsion
Body
Running gear

• Cables, bus systems, embedded systems
• Iskra Avtoelektrika

• Power train, exhaust systems, engines
• N.a.

• Cockpit, seats, dash-board, air conditioning
• Agis Plus

• Body, roof, glass, doors, lighting etc.
• ADK
• Strenia
• Stroj

• Suspension, brakes, axles, steering, tires
• N.a.

Source STC research
40
SLOVENIAN PRODUCERS ARE MOSTLY FOCUSING ON
GERMANY- Stroj exports 90 of production mainly
to Germany and Austria
Source STC research
41
A FEW SLOVENIAN SUPPLIERS TO THE CAR INDUSTRY IS
ALSO SUPPLYING THE CONSTRUCTION EQUIPMENT
SEGMENT- Agis Plus is for example supplying both
segments with seats locks
Radlje ob Dravi
Maribor
Ptuj
Ljubljana
Polje
Source STC research
42
CONTENT

• Overview Slovenian Manufacturing Industry
• Slovenian Automotive Industry
• Slovenian Construction Equipment Industry
• Recommendations

43
SEVERAL ADVANTAGES WITH SLOVENIAN AUTOMOTIVE
SUPPLIERS- Short lead-times, good logistics and
high competence make Slovenian suppliers
attractive
ACS Automotive Cluster Slovenia
Source STC research, ACS Automotive Cluster
Slovenia
44
STC SUPPORT COMPANIES TO DO BUSINESS IN
SLOVENIA- Long experience and well developed
network serves as facilitator
With long experience of dealing with Slovenia and
with a well established network of contacts to
different important stakeholders in the industry,
STC can offer many different types market
research analysis services
Market Analysis
Partner Search
STC has well developed knowledge concerning the
different companies in the Slovenian
automotive industry and can assist Swedish
companies in the search for suitable partners or
other partners
Customer Identification
Due to its familiarity with the Slovenian
automotive companies, STC can also assist Swedish
companies in the search for customers in the area

Pre-acquisition analysis
STC can assist Swedish companies in the first
stage of an acquisition process by for example
mapping potential candidates and arrange initial
meetings with company representatives
Since Slovenian companies often works as hubs for
the whole Balkan area and thus take benefit of
the low labor costs in Serbia and Bosnia, STC can
help Swedish companies to source
components/systems from this area
Production Sourcing
Business Support
STC can assist Swedish companies in their contact
with Slovenian companies by arranging meetings,
identifying proper business contacts and to
provide necessary information
For more information, please do not hesitate to
contact Carsten Grönblad (Area Manager Slovenia
and Croatia, STC Austria) at carsten.gronblad_at_swed
ishtrade.se or Mats Bergman (Trade Commissioner,
STC Austria) at mats.bergman_at_swedishtrade.se
Contact