Despite its weak start, the Bulgarian automotive industry has turned into a leading one in this country at times when the growth in sectors such as tourism and real estate is almost flat. Around 50 companies including small subsidiaries, international suppliers and small local manufacturers employ almost 9 000 people in Bulgaria. The industry made sales worth EUR 1 billion in 2011 and accounts for nearly 4% of the total export volumes of Bulgaria, shows data of the British financial daily newspaper Financial Times. Clients of the Bulgarian automotive industry are companies such as Mercedes-Benz, BMW, Ford, Audi, Citroen, Peugeot and Renault. The automotive suppliers are attracted to do business in Bulgaria by the low expenses on manpower as compared to other EU countries as well as by the 10% flat tax rate and the stable Bulgarian currency, which was fixed to the Euro in the monetary board. Moreover, foreign companies can employ many young engineers in this country. On another hand many skillful and experienced experts in this industry are now returning home due to the higher unemployment in the USA and the EU.
The first companies which came to do business in Bulgaria were German ones such as Festo, which started to manufacture automation systems 20 year ago. Another example is the companies Ixetic, which produces hydraulic pumps and Witte automotive which manufactures locking systems. They sell their produce to most of the European car manufacturers. The company BHTC( Behr Hella Thermocontrol) is planning to open a new factory in Bulgaria. It will produce car air conditioning and engine cooling systems and will employ 600 people.
The Research and Development center(R&D) Johnson Controls in Sofia is one of the biggest companies within the US Automotive ones which employs over 600 experts, who develop car electronic systems. The Bulgarian experts are expecting a steady flow of investments of companies linked with the automotive industry after the biggest Chinese car manufacturer Great Wall Motors has chosen Bulgaria as a test market in the EU. Litex Motors which is a joint company of the Chinese firm and a Bulgarian holding group started to manufacture makes of Great Wall in the car factory in Lovech(Central Bulgaria). The factory assembles the Voleex C10 Hatchback and as of 2013 it is planning to start to manufacture the Steed 5 Pick up as well as Hover 5, which is one of the most popular Chinese SUV’s.
Other non-EU companies have also chosen Bulgaria as they are planning to enter the markets of Central and Eastern Europe later. The South African ALC produces in its factory near Sofia seats and interior accessories for BMW, Mercedes and Nissan. Two Turkish firms- Ayfa Otomotiv and Mars Otomotiv will start to produce head-lights and other lighting accessories. The Indian company Escorts is planning to build a factory for car parts and a tractor assembly plant. Before Great wall entered the Bulgarian market this country could not attract foreign companies from this industry who were seeking to cut their production costs. The only exception was the French company Montupet which has a factory for engine parts in the town of Ruse. These parts are used in the factories of Renault-Dacia in Romania. According to experts, the French company has managed to invest in Bulgaria thanks to the help of the Municipality in Ruse and the currency stability. The factory also started to produce parts for Ford.
A cluster for encouraging of the production and use of electromobiles was founded in Bulgaria. The first step of its members was to create a joint company for the development of EV charging stations for hybrid cars and electromobiles. Bulgaria has enough know-how for the manufacture of electric vehicles, because this country was once among the worlds’ biggest producers of electric trucks. This is a good prerequisite for professional competence in order for Bulgaria to enter deeper in this market.
English version: Kostadin Atanasov
