The pace of investments targeting the automobile industry will maintain and even speed up in the medium term, with production relocations from Western European countries to generate a steady turnover growth, which is likely to amount to 9 billion euros or, according to a more upbeat projection, to even 12 billion euros around 2010, the Association of Romanian Carmakers (ACAROM) predicts.
"The less optimistic projection takes into account the following scenario: in the wake of EU accession, Romania will attract fewer relocations, since there are countries east of Romania boasting lower labour costs," says Constantin Stroe, ACAROM chairman and vice-president of the Board of Automobile Dacia.
On the other hand, the positive scenario means, according to Stroe, a flow of new investments triggered by the fact that Romania will continue to enjoy a considerable advantage after its EU integration, in terms of labour costs, over the Czech Republic for instance.
Companies operating in the Romanian automobile industry (manufacturers of automobiles and car components) last year posted turnover worth 3.8 billon euros. Dacia alone contributed 1.2 billion euros to this value.
The industry will see turnover grow this year, in line with ACAROM estimates, to about 4.9 billion euros.
"As of 2007, the growth pace will be faster, since many of the plants announced recently will become operational," Stroe adds.
With 6.4 billion euros in 2007 and 8 billion euros in 2008, the Romanian automotive industry will consolidate its fame as an Eastern El Dorado, because its low labour costs and highly skilled work force allow the companies to make significant cost cuts.
"We currently have orders from the carmakers based in Detroit (the city where three of the world''s top carmakers are headquartered: Ford, General Motors and DaimlerChrysler), which are interested in car parts originating from Romania," says Constantin Stroe.
Even though Romania is still lagging behind some countries such as the Czech Republic or Poland when it comes to the foreign investment attracted by the car industry, the gap is about to narrow down.
"The level of investments in the car industry currently stands at 450-500 million euros annually and I believe this trend will maintain over the following years," Stroe states.
He estimates the total volume of investments in the car industry and related fields at approximately 5.8 billion euros.
Consequently, the total volume of investments is likely to exceed 8 billion euros by the year 2010.
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