Slovakia - Vehicle Parts and Components, HS Code 87 Slovakia - Vehicle Parts and Comp
Overview
| 2016 | 2017 | 2018 | 2019 (Estimated) | |
| Total Market Size | 8,067,230 | 9,279,454 | 8,808,981 | 8,500,000 |
| Total Local Production | 18,396,585 | 19,554,000 | 21,568,000 | 21,000,000 |
| Total Exports | 21,763,721 | 22,325,094 | 27,791,209 | 28,500,000 |
| Total Imports | 11,434,366 | 12,050,548 | 15,032,190 | 16,000,000 |
| Imports from the U.S. | 13,175 | 21,354 | 20,759 | 20,000 |
| Exchange Rate: 1 USD | 1.1069 | 1.1297 | 1.1810 | 1.14 |
Data Sources:
Total Local Production: Statistical Office of the Slovak Republic
Total Exports: Global Trade Atlas
Total Imports: Global Trade Atlas
Imports from U.S.: Global Trade Atlas
Exchange Rate: European Central Bank
Leading Sub-Sectors
The following specific items were the leading exports from the U.S. to Slovakia covered by this Leading Sector, ranked by USD from 2017 to 2018:| HS code | ITEM | 2016 | 2017 |
| 8701 | Tractors (Other Than Works Trucks Of Heading 8709) | 9,300,668 | 9,324,690 |
| 8708 | Parts & Access For Motor Vehicles (Head 8701-8705) | 9,933,250 | 7,988,899 |
| 8703 | Motor Cars & Vehicles For Transporting Persons | 1,348,442 | 2,166,236 |
| 8705 | Special Purpose Motor Vehicles Nesoi | 300,364 | 642,258 |
| 8711 | Motorcycles (Incl Mopeds) & Cycles With Aux Motor | 160,277 | 384,926 |
| 8714 | Parts & Access For Cycles & Invalid Carriages | 101,701 | 115,212 |
| 8713 | Carriages For Disabled Persons,Motorized Or Not | 188,145 | 110,464 |
| 8712 | Bicycles & Oth Cycles (Inc Del Tricycle) No Motor | 2,754 | 14,599 |
| 8704 | Motor Vehicles For Transport Of Goods | 4,829 | 7,622 |
| 8716 | Trailers Etc; Other Vehicles, Not Mech Propeld, Pt | 9,057 | 4,816 |
| 8715 | Baby Carriages (Inc Strollers) And Parts Thereof | 2,525 | 144 |
| 8707 | Bodies (Including Cabs), For Specif Motor Vehicles | 2,090 | - |
| 8701 | Tractors (Other Than Works Trucks Of Heading 8709) | 9,300,668 | 9,324,690 |
| 8708 | Parts & Access For Motor Vehicles (Head 8701-8705) | 9,933,250 | 7,988,899 |
| 8703 | Motor Cars & Vehicles For Transporting Persons | 1,348,442 | 2,166,236 |
Opportunities
With four car manufacturers and 1.08 million cars produced in Slovakia in 2018, Slovakia was the world leader in per capita auto production for the fifth year in a row.Automotive production represents about 46.8% of Slovakia’s industrial production and 35% of country’s industrial exports.
In 2018 there were over 340 Tier 1 and Tier 2 auto suppliers, providing parts and subassemblies to clients throughout Europe and beyond. The further development and localization of auto suppliers should decrease car component imports in the future from 60% to 40%. Automotive production directly employs 129,000 people, while the total number of people employed in the automotive industry is 250,000.
Slovakia’s favorable geographic location includes proximity to 12 automobile manufacturing plants within the Slovak and Czech Republics, Poland, and Hungary.
The allocation by manufacturer is:
- VW Slovakia in Bratislava is the only plant in the world producing five car models. In 2018 Volkswagen’s 14,000 local employees produced over 400,000 cars.
- KIA Motors Slovakia in Zilina employs 3,800 and produced 333,000 cars in 2018.
- PSA Slovakia in Trnava employs 4,500 and produced 352, 007cars in 2018.
- Jaguar Land Rover (JLR) in Nitra has a projected annual production capacity of 150,000 vehicles. The plant’s construction began in 2016, and the first SUV Discovery model vehicles left the plant in October 2018. The 2018 production data is not available. The factory features a special linear synchronous conveyor with electric drive/electro-induction linked to the production line, making it the first industry 4.0 automotive production facility in Europe.
Automobile Parts and Aftermarket Products
Slovakia is an EU member country and thus the market for automobile parts and equipment is largely saturated by products from countries such as Germany, Austria, and France. Competitive pricing and just-in-time delivery are essential for U.S. suppliers to be successful in selling to the four OEM automobile manufacturers in Slovakia and to their Tier 1 suppliers.
Slovakia follows the EU’s trend on diesel cars following recent negative publicity. The interest in petrol engines in 2018 grew by 65,209 cars and their market share rose to 66.5 percent while diesel engine market share fell to 30 percent.
The most sold personal cars by market segments are:
| A – mini | Volkswagen UP | 272 |
| B – small cars | Skoda Fabia | 5,433 |
| C- lower middle class | Skoda Octavia | 5,046 |
| CD – middle class | Skoda Superb | 1,571 |
| D – higher middle class | BMW r.5 | 386 |
| E – luxury class | Mercedes-Benz class S | 120 |
| F – sports cars | BMW R6 Gran Coupe | 100 |
| G – SUV | Hyundai Tucson | 2,173 |
| H – MPV | Volkswagen Touran | 834 |
Source: Automotive Industry Association of the Slovak Republic
Slovakia has traditionally benefited from an attractive combination of skilled labor and low labor costs. Lately, however, a lack of expertise has been reported in industries including the production of instruments and tools, metalworking, foundry, new materials processing, and machining. It can be difficult to find experienced electronic and technical engineers, machinery and tool engineers, CNC machine and robot operators, technologists, designers, quality controllers, lacquerers, power press operators, logisticians, purchasers and maintenance people who speak at least one foreign language. Experienced managers and IT specialists are in high demand. As a result, U.S. suppliers of training programs that focus on technical skills and foreign language abilities will find opportunities in Slovakia. In an attempt to better align education with sought-after workforce skills, the Slovak government introduced a new dual education program in 2015. In support of this initiative some of the major players in the automotive sector, including Intech and Volkswagen in cooperation with Matador and Siemens, founded vocational programs. A continuous lack of interest by Slovak students in these programs has resulted in a scarcity of skilled, motivated workers in these fields, which forces OEMs and suppliers to look abroad (primarily to the Balkans) to fill jobs openings. A recent survey by PwC and the Automotive Industry Association concludes that up to 50% of auto suppliers claim they have lost business opportunities due to the lack of qualified labor. Through 2020 the Slovak automotive sector may require up to 14,000 new workers (7,000 by OEMs and 7,000 by suppliers) out of which 2,000 should be university graduates. Future workers will be able to obtain dual education.
In Slovakia there is excellent potential to penetrate the R&D activities of the large automobile corporations in specific segments. Current examples include Adient’s R&D center in Trenčín which develops interior elements, Continental Automotive Systems in Zvolen which develops braking systems, Plastic Omnium in Lozorno which develops integrated modules for car interiors, and Matador Holding in Dubnica nad Váhom which develops components for automation of production and new material applications. The development of applied R&D in the automotive production field is critical for continued sectorial growth, with target opportunities including smart production (intelligent manufacturing with digitalization, sensors, internet of things and automation), innovative materials (composite, organic, memory), components, complex solutions, adjacent processing, 3D printed equipment and recycling of waste.
The Slovak government and the Slovak Automotive Industry Association share the goals of supporting and streamlining professional education, creating an R&D base, encouraging OEM automobile manufacturers to maintain local production, supporting sub-suppliers and improving cooperation with OEMs, developing an e-mobility strategy and finalizing the law on the disposal and recycling of old automobiles.
Electric Cars
The Slovak car manufacturing industry produces about 6,000 electric and hybrid cars annually, including the Volkswagen e-up, Touareg Hybrid, and the Audi Q7 e-tron, the first plug in diesel hybrid in the world. Green cars represent 0.3% of all cars on Slovakia’s roads. The low interest in green cars is due to their relatively high price, a limited charging station network, longer charging times, limited range, and electricity prices which are occasionally higher than gas prices. Sales of electric and hybrid car purchases were worth EUR 5.2 million (USD 5.92million) from 2016 to 2018. That included an increase of 293 electric cars (0.3 percent market share increase) and 2,072 hybrid cars (27.5% market share increase).
The Slovak Ministry of Economy is considering a campaign, to introduce supporting policies such as different vehicle plates, assigned parking lots and driving lanes, advanced amortization for electric cars and charging stations, simplified construction processes for charging stations or public procurement projects, and R&D support for battery development.
Web Resources
Automotive Industry Association of the Slovak Republic
Internet Portal for Slovak Automotive Suppliers
Ministry of Transport, Construction and Regional Development of the Slovak Republic
Statistical Office of the Slovak Republic
Ministry of Economy of the Slovak Republic
Slovak Trade and Investment Agency