Singapore firms eye opportunities in Czech automotive industry

Singapore firms eye opportunities in Czech automotive industry

Manufacturing firms from Singapore are exploring opportunities in the Central and Eastern European region, particularly in automotive and aerospace sectors which are strong engines of growth for the local economies.

SINGAPORE: Manufacturing firms from Singapore are exploring opportunities in the Central and Eastern European region, particularly in automotive and aerospace sectors which are strong engines of growth for the local economies.

Representatives from 17 Singapore firms co-led by IE Singapore and Singapore Business Federation have completed a week-long business mission to Poland and the Czech Republic, in conjunction with President Tony Tan Keng Yam’s state visits to these countries. Almost half of the representatives were from the manufacturing industry.

During his state visit to the Czech Republic, President Tan visited Interplex Holdings, a Singapore-headquartered precision engineering firm with a network of more than 40 manufacturing plants located in 13 countries worldwide, and with about 12,000 employees on its books.

Interplex Precision Engineering Czech Republic was established in Pisek, a town in the South Bohemian region of the Czech Republic, in 2000. It currently has 550 employees in its factory, about 10 of whom are Singaporean.

Interplex Holdings CEO Alessandro Perrotta cited key trends that are transforming the automotive industry and driving demand for more sophisticated precision engineering - environmental, connectivity and safety.

“The automotive industry is basically moving from combustion engine to electrical engine,” Mr Perrotta said. “What it means for us is now combining the electrical part with the mechanical part to create an integrated solution known as mechatronics.”

Tony Tan Interplex 2
President Tony Tan tours Singapore-headquartered Interplex Holdings factory in Czech Republic. (Photo: Nicole Tan)

Amid the emergence of autonomous cars, Mr Perrotta said car manufacturers need very precise components that can withstand harsh environments, as “the car is making decisions to drive versus us controlling it”.

Citing growth prospects in “Industry 4.0”, referring to the use of smart technology in the manufacturing industry, Mr Perrotta said: “You have to be here. You leverage good proximity of Germany with a low cost manufacturing base, and you’re close to customers here.”

The car industry is a major driver for the Czech economy, accounting for more than 20 per cent of both Czech manufacturing output and Czech exports, according to data from the country’s business and investment development agency Czech Invest.

Latest statistics from Czech Republic’s Automotive Industry Association Auto SAP showed that production and export of cars grew by almost 11 per cent in the first quarter of 2017 compared to the same period a year ago.

To accelerate strengthening of ties between Singapore and Czech Republic economies, new partnerships were signed between IE Singapore and Czech Trade Promotion Agency, Singapore Business Federation and Confederation of Industry of the Czech Republic.

Dr Tan, who witnessed the signing of the partnerships, said that with both countries as gateways into their respective regions, it is important for Singapore and Czech Republic to remain open and expand networks as "fellow small states in an ever-changing environment".

Tony Tan Interplex 1
President Tony Tan tours Singapore-headquartered Interplex Holdings factory in Czech Republic. (Photo: Nicole Tan)

Singapore Business Federation told Channel NewsAsia that Poland and Czech Republic are very strong in automotive engineering, and CEO Ho Meng Kit said these economies are "more competitive" and have lower cost of manpower.

Mr Ho said these markets also provide closer access to the European Union market with about 500 million customers.

Singapore-based manufacturer, Dou Yee Enterprises, which provides materials and equipment for industries including data storage, biomedical, electronic and automobile industries, is part of the business delegation and exploring the possibility of setting up a manufacturing plant in Poland.

President Tham Wai Mun said he visited Czech-headquartered car manufacturer Skoda to gain "market knowledge and insights into its strategy", as some of Skoda’s suppliers are among Dou Yee’s customer base.

Skoda accounted for more than half of Czech Republic’s automobile production in 2016, according to data from the country’s Automotive Industry Association Auto SAP. The Czech Republic produced a record of more than 1.34 million cars in 2016, up more than 8 per cent compared to the year before.

Source: CNA/ec

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