Škoda cars made in Germany?
According to insider reports the Volkswagen group is planning to counter competition between sister brands VW and Škoda and transfer the production of Czech vehicles to German plants that are operating below their maximum capacity. In addition Škoda is to contribute more to the company's development costs. The government in Prague and trade unionists are protesting. Czech commentators, however, point out that the Germans' plans are perfectly reasonable.
Czech Republic just an extended production line
The Czech Republic is now paying the price for not giving its automotive industry the support it needed to become sustainable, Aktuálně.cz observes:
“The government invests plenty of money in supporting car production. But the millions just flow into production - not into developing our own technologies and know-how. For Volkswagen that worked out well up to now because in Germany salaries are much higher. And Škoda is successful while VW only has problems. German trade unionists complain about the 'wage dumping' in the Czech Republic. But the wages are low here because we only put together cars rather than developing technologies. We live from German technology and from our exports to Germany. Volkswagen is a company behaving in a way that is normal and logical for companies. We are a state that is behaving abnormally and illogically.”
Nokia's decline as a warning
The protests from Prague are uncalled for, Echo24 comments:
“The trade unions are warning about the loss of 2,000 jobs, Prime Minister Bohuslave Sobotka wants to talk to the company's management. These are overreactions to this redistribution of financial resources within the company, which is under pressure globally after the diesel scandal. ... Škoda itself has been complaining for a long time about barely being able to find workers in the country as a result of the record employment figures. ... These reactions become more understandable when you consider the importance of Škoda and its suppliers for the entire Czech economy. ... One feels reminded of Finland when Nokia - which was even more dominant there than Škoda here - missed out on the birth of the smartphone. This triggered a recession from which what was once one of the world's most competitive economies still hasn't recovered.”