The economic crisis is forcing companies based in the Czech Republic to move production to other countires. As of last September a number of firms moved abroad, some of them the makers of traditional Czech brands. Hera margarine, Mochov vegetables, Solo matches and Akuma car bateries are some of the brands that will no longer be produced here.
Hera margarine, Mochov vegetables, Solo matches and Akuma car bateries are some of the brands that will no longer be produced here. “The crisis has enabled owners to quickly and agressively close down productions. Companies are not just moving to lower labour costs but also to restructuralise and optimise their production and reduce overall expenses,” says Radek Schmied of the consulting company Redbaenk.
Unilever is a typical example. Under American ownership the factory operated in the Czech Republic for more than 15 years. Now it will produce the well-known margarine Hera in Poland and in Romania.
Akuma, the subsidiary of the Italian Fiamm group, will stop producing batteries in Mladá Boleslav after more than 100 years. It will centralise its production in one factory in Italy.
Solo Sušice will move to a less expensive Asian country. Probably India, the biggest exporter of matches in the world.
The production of traditional cancer drugs in Brno’s Lachema will stop. The drugs were produced there since 1980. The Israeli company Teva Pharmaceutical, which bought the company as part of the US group Barr Pharmaceuticals last year, has decided to produce the drugs its other factories abroad, mainly in Hungary and the Netherlands.
It’s a shift in startegy just recently when most owners were moving production out of the Czech Republic mainly just to reduce labour costs.
Czech unions point out that decisions to shift production abroad now often has to do with protectionist measuers.
An increasing number of companies are also being offered up for sale as a result of the crisis. These companies include Adast and Jablonex.
