The potential of automotive industry

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The potential of automotive industry

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The potential of automotive industry

  1. 1. The potential of automotive industry in Poltava region Poltava, 2013
  2. 2. Outline• Ukrainian car market – Concentration of the cars for thousand of people – Cars-bestsellers – Consumer preferences Ukrainian market – SWOT analysis of production cars in Ukraine – Volumes of auto in Ukraine – Major car manufacturers in Ukraine• Poltava region – Geographical location of Poltava region – Investment map of Poltava region – Automotive industry in Poltava region• The city of Kremenchuk – Brief information about the city of Kremenchuk – Kremenchuk is a place of car production – Land plots for automobile plant and related enterprises – Advantages of investing in the automotive industry
  3. 3. Ukrainian car market
  4. 4. Ukrainian car market Concentration of the cars for thousands of people is much lower than in European countries, or even than in Russia Quantity of cars per thousand of people, 2011: Poland 453 Czech 441RepublicHungary 301Slovakia 295 Russia 228 Ukraine 178 0 100 200 300 400 500 Source: 2012, PJSC «Deloitte & Touche USC»
  5. 5. Ukrainian car market Cars - bestsellers in 2011(units): Cars - bestsellers in 2011(%):35 000 14,0% 29 02530 000 12,0% 13,1 22 77425 000 10,0% 10,3 20 380 9,220 000 8,0% 13 731 6,215 000 11 944 6,0% 11 544 10 928 5,4 5,2 5,0 11 075 10 825 4,9 4,9 9 935 4,510 000 4,0% 5 000 2,0% 0 0,0% Quantity The market share Source: 2012, PJSC «Deloitte & Touche USC»
  6. 6. Ukrainian car market Preferences of Ukrainian Structure of demand by the consumer market country of production,%: up to 12 thousand• Consumers prefer economical and dollars compact car, B and C class; 26 12 -15 thousand• Strong demand for all-wheel drive 34 dollars models and business class auto; 15 -20 thousand• High demand for cheap cars up to dollars 12 thousand dollars - strong 19 6 domestic producers; 15 20 -25 thousand dollars• Stable demand for expensive cars from 25 thousand dollars from 25 thousand dollars Source: 2012, PJSC «Deloitte & Touche USC»
  7. 7. SWOT analysis of production cars in Ukraine Strengths Weaknesses• Skilled and relatively cheap labor force • Pressure on the business of the• Capacious consumer market various authorities• Geographical and cultural proximity to • Over-regulation and poor predictability the European consumers of the economic environment• Modernization of the infrastructure • The dependence of the economy on related to the holding of Euro 2012 external factors (input prices, demand• Developed production capacities in the EU) • Tax pressure and the complexity of the tax system Opportunities Threats• Trade liberalization with the EU (export growth in this direction) • Restrictions on exports to Russia• Base of export to Russia (recycling fee, customs regulation)• Rising consumer incomes (more than • Sending of cars from the EU at lower 70% of households still do not have a import duty (including used cars) car) • Macroeconomic risks (slowdown in• Full recovery of auto crediting GDP growth, investment outflows,• State support for automotive industry reducing of foreign financing) (soft loans, tariff protection) Source: 2012, PJSC «Deloitte & Touche USC»
  8. 8. Ukrainian car market Volumes of auto in Ukraine,pc.: Structure of demand in the country of production,%:70 000 59 360 1,7060 000 5,61 EU50 000 South Korea40 000 10,47 27,82 Japan30 000 20 240 12,79 Russia20 000 11 656 6 329 Ukraine10 000 17,33 24,28 0 China ZAZ Bogdan Eurocar KrASZ Other Source: 2012, PJSC «Deloitte & Touche USC»
  9. 9. Major car manufacturers in Ukraine Source: 2012, PJSC «Deloitte & Touche USC»
  10. 10. Poltava region
  11. 11. Geographical location of Poltava region Source: Poltava Regional Center of Investments and Development
  12. 12. Investment map of Poltava region Map symbols Source: Poltava Regional Center of Investments and Development
  13. 13. Automotive industry in Poltava region• Poltava region has a long history of truck production (since 1958)• Two universities and six colleges that train personnel for the automotive industry. Up to 1000 specialists graduate every year• Automotive industry employs near 7 000 people• In the manufacturing process employs about 100 related enterprises (the largest - HC "AvtoKrAZ" – 4 500 workers, LLC "KrASZ" - 358 employees and PJSC "Vepr" - 42 employees, PJSC "Kremenchug Wheel Plant", JSC "Obod", LLC "Autosteklo", SPE LLC "Prisadki", LLC "Yuniol", LLC "Krempolimer" and others)• The level of salary paid to blue-collar workers is about from 240 to 300 EURO Source: Poltava Regional Center of Investments and Development
  14. 14. The city of Kremenchuk
  15. 15. Kremenchuk is a place of car production Source: Poltava Regional Center of Investments and Development
  16. 16. Brief information about the city of Kremenchuk• Kremenchuk is an industrial city• The city area: 10 000 ha• The population of the city - about 230 thousand people• Located at the crossing of highways (Boryspil - Kyiv and Poltava Olexandria-Odessa) and railways• Advanced river transport. River port is available. Requirements for the ships: draught 3.2 m, length 125 m, type of vessel: river-sea, tonnage: to 3.5 thousand tons• Distance to Kyiv - 286 km, to Boryspil - 254 km, to Poltava – 119 km, to Kharkov - 250 km, to Dnepropetrovsk - 162 miles, to Donetsk – 403 km, to Zaporizhzhya – 225 km, to St. Petersburg – 1 585 km Source: Poltava Regional Center of Investments and Development
  17. 17. Land plot for automobile plant and related enterprises • Land plot is located in Kremenchuk. Territory area adjacent to the Northern industrial hub. The plot is Land plot proposed for placement of industrial facilities • Land area :168.55 ha​​ • Owner : City Council Source: Poltava Regional Center of Investments and Development
  18. 18. Advantages of investing in the automotive industry• The strategic location of Ukraine: access to markets of the European Union, Asia and the Middle East;• Low transaction costs for business;• "0" rate of taxes on equipment and components to it that are not produced in Ukraine and imported by initiators of creation and/or managing companies for the construction of an industrial park;• "0" rate of taxes on machinery, equipment and components that are not produced in Ukraine and not excise taxed goods imported by participants of industrial parks for business within industrial parks;• Exemption from equity participation in infrastructure development of settlements in which established industrial park;• State support (supply of engineering and transport infrastructure) industrial park;• Transparent and simple acquisition of ownership rights of land within the industrial park;• Time to market for participants of the industrial park is 6 - 9 months;• Highly skilled workforce;• Large domestic market - 46 million people Source: Poltava Regional Center for Investments and Development
  19. 19. Contacts4, Shkolnyi Lane, of. 41, 45. Poltava, Ukraine. 36003Leta Dmytro - Acting Director of Poltava RegionalCenter of Investments and Developmenttel.: +38-0532-50-08-64mob. tel.: +38-066-816-52-09e-mail: leta.dima@gmail.comskype: leta.dimawww.investinpoltava.com.ua Source: Poltava Regional Center for Investment s and Development

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