CTP Business Director talks about electronics manufacturing in Czech Focus
Why should electronics manufacturers choose the Czech Republic over other parts of the world or other CEE countries?
The Czech Republic is a modern electronics hub based on many years of tradition, a solid educational system and strategic location. These days, the electrical engineering and electronics sector employs nearly 180,000 people and accounts for more than 14% of Czech manufacturing output.
What are the location hotspots in the Czech Republic and centres of excellence?
The CTPark Network is home to many investors from a number of fields, ranging from electron microscopy and robotics to consumer electronics. Approximately 15% of CTP’s client portfolio comes from the electronics sector. Within our Czech portfolio, a number of locations have emerged as preferred destinations for electronics investors, such as CTPark Brno, which is home to electron microscope manufacturer FEI and hardware producer Acer, and is a key R&D location for Honeywell. CTPark Plzeň in the west ofthe country is an attractive location for both manufacturing of electronic goods (China’s Hisense recently took over 10,000 m2 space in CTPark Plzeň) and as a logistics hub. Longterm CTP client TechData operates a 50,000 m2 distribution centre in CTPark Bor, just a few kilometres from the Czech-German border. Lease vs. freehold, which is better for me? Electronics manufacturing often involves complex processes and more often than not requires a complex space solution. Fortunately, CTP has the know-how to smartly accommodate such requirements, which vary from super-stable anti-static flooring for precision engineering to movable partition walls to cater for seasonal overflows and production peaks. CTP remains the owner and manager of the buildings we develop, which allows our clients to concentrate on their core business.
What about the labour pool, specifically for the electronics industry?
Labour costs in the Czech private sector stand at 38% of the EU-28 average. Nevertheless, the main benefit of the Czech Republic consists in the excellent cost-quality ratio of the country’s highly educated and skilled workforce. This is especially relevant in comparison to other CEE countries. Over the past five years the average annual wage has risen by roughly 13%, though from a much lower base compared to Western Europe. According to Eurostat’s data from 2014, the Czech Republic’s labour costs remain very competitive in the EU. The Czech Republic can offer average labour-cost savings of 40% to 60% in comparison with costs in Western Europe or the United States. For instance, in 2014 theCzech hourly wage in the manufacturing sector was EUR 9.40 as compared to EUR 31.40 in Germany, EUR 34.60 in France and EUR 22.30 in the United Kingdom.
How much will an A-Class facility cost me?
The price per square metre for a production/ warehouse facility in the Czech Republic compares favourably with that in Western Europe. The number of ecologically friendly buildings is also on the rise; the number of BREEAM-certified assets in the Czech Republic stands upward of 60, which is more than in other CEE markets such as Romania, Hungary and Slovakia. Investors are increasingly looking for ways in which to lower their ecological impact; since 2011, all CTP buildings are built to BREEAM standards.
How long will it take to build a facility?
CTP can construct and hand over a building typically within nine months, which includes all preparation, tendering and permitting. For bespoke buildings, what we call our CTFit solution, it might take a little longer depending on the scope. However we have all designers and engineers in-house, which dramatically speeds up the process. For our standing portfolio, move-in time is much shorter and will depend entirely on the required interior fit-out and placement of machinery, which we can also assist with.
Read the article in Czech Focus: https://goo.gl/GH2LbP.