Photo: Adam Sikorski - President of the Polish Motor Group and PZL Sędziszów SA
- The year 2017 is already behind us. What was it like for the Polish motor sector?
Last year, similarly to 2016, was good to the Polish motor sector. Mainly due to growing sales of new cars on foreign markets. As the sale of new vehicles increases, so does the production of spare parts, as well as those to be used in the assembly of vehicles in factories. What is important, Poland is still an interesting location for investments, such as building new factories or developing the existing ones. This brings optimism to both the domestic suppliers of spare parts and the labour market.
- The labour market is not good though, at least from the point of view of employers.
That is true. The main problem faced by the motor sector concerns searching for experts in each and every area of this sector: production, service, post-accident repairs, sale of vehicles, etc. There was some hope placed in employees from Ukraine, but this has not solved the problem. This is why I believe a major increase in salaries should be expected soon, in order to keep employees or attract them. We need to move in the direction of what is known as education 4.0 or even 5.0, and raise awareness in people - those with high school and academic education - that there is no disgrace in working as a lorry driver or a machine operator, despite being well qualified. This is the very type of work we need people for in the motor sector right now. So far the situation with white collar jobs is better.
This is why, in time, changes in the pay of people performing such work are unavoidable and diametric. First of all, we need to attract them to such work, and second of all, which may prove to be more difficult, compensate for the fact they have solid, often higher education, and sometimes even in several faculties.
- Are you trying to suggest that a person with higher education should start working on a production line?
Why not? And I would not like to read anything bad into that. This model has been successful in Western European countries. Blue collar workers are nowadays treated with the same respect as executives. And even if this is not the case yet, it soon will be. Moreover, a lot depends on the economic situation of specific individuals and financial needs. Certain production-related positions in the industry are much better paid than certain office professions performed by so-called white-collar workers.
All this needs to undergo a process. Today the resources of employees for managing or marketing positions are sufficient. However, we should bear in mind that they might easily lose their jobs or simply not find openings, in a situation where the staff, which is the key resource of the company, will be its weak point. When it comes to the motor sector, these include the positions I have already mentioned. This is the reality and the needs of the market. Moreover, not all directions of studies - did, do and will - guarantee a better life or a better paid and more interesting job. Of course, in certain cases an academic degree is necessary, but not always. Let me also add that the very reason for studying will be changing: let me repeat that an academic degree is not always tantamount to better work and pay. An academic degree gives you additional knowledge that may be very helpful in everyday life, self-development, personality, status in certain circles in which we exist, hobbies, etc. Nowadays, due to fear for HR deficiencies, companies are forced to look into automation. Otherwise, despite the improved economic situation, they will not be able to implement orders.
- Interesting observations. However, let us come back to 2017 in the motor sector. What was it like and what should we expect from 2018?
Unless there is an unexpected crash on the international markets, on which Poland depends highly, there should be as much growth in the present year in the motor sector as in the last couple of years. Nevertheless, we should bear in mind that, in addition to ‘growth and increases’, we are still facing unresolved problems, inappropriate trends, certain events and challenges that should be faced. For some of them, 2018 will certainly not be long enough, since they require long-term processes and actions. One example is education, as I have already mentioned, but also quality of parts used in repairs and production, which is proven by the year-to-year increase in the scale of rapid alert repair actions, imports of spare parts of questionable quality, problems with the policies of certain distributors as regards cooperation with producers of spare parts, second-hand cars imported from the Western European Union countries to Poland, as well as such challenges as: how domestic companies use the development trend in the motor sector in Poland, the development of electromobility, as well as the expansion and promotion of Polish and foreign motor sector companies.
- Let us devote a paragraph or two to each of these issues.
I. Quality and import of spare parts
In this case, one is associated with the other. Quality of imported spare parts, predominantly from China, often has little in common with the quality. Consequently, not only importers/distributors suffer from this, but also the safety of people on roads, the safety and quality of vehicles admitted to traffic, the profitability of car service points, which lose time adjusting parts of vehicles being repaired, and Polish and European producers that need to satisfy stringent standards and at the same time compete with cheap production of unknown origin and disputable quality.
II. Never-ending import of old cars
According to data from the Motor Market Research Institute SAMAR, over the whole 2017, the number of imported second-hand cars dropped by over 9%.This is surely good news and arises, most probably, from the implementation of CEPiK and the possibility to check the credibility and origin of imported cars, which translates into greater caution on the part of unfair dealers. On the other hand, there is still no great interest in purchase of new cars, and this slight drop in the import of second-hand cars does not prove the existence of a dropping trend.
Maybe due to the growing trend for electromobility in western countries, creating no-emission areas in cities, old cars will become cheaper, in particular diesel cars. This, however, comes with a risk that these cars will find new owners in Poland. On the other hand, however, we have our own domestic plans related to restrictions on such vehicles. Another issue is that, since electromobility in Poland is developing rather slowly, several years will have to pass before any greater changes on the market of spare parts for combustion vehicles occur.
III. The problem of domestic companies producing spare parts for the ‘aftermarket’ with cooperation with certain distribution companies.
What is visible in Poland is the domination of strong motor companies that have spent decades building up their position, including through the development of techniques and technology. Their strength in this sector has been and will remain visible. Nevertheless, it is worth noting the strategies of sustainable development being implemented by Western European companies. This means that the Germans, Swiss or French will not be so eager to opt for an offer of a company from another state, even if it is 30% cheaper. They will continue to cooperate with their domestic suppliers. This is why, together with motor investments in Poland, a number of companies appear - suppliers from these very countries. These companies ‘drag’ other companies with them. Such a model of operation should be promoted in our domestic companies - a model of cooperation with other domestic companies. What I have in mind are proven mechanisms that are used and that are efficient.
In such a systemic operation, a significant role in promotion could be played by the national champions and the large distribution centres, offering domestic products more eagerly and with emphasis placed on their origin and brand. Nevertheless, nowadays Polish products are most often presented as no-name products and sold under the brand of their distributors.
- I understand that the problems you mention also constitute challenges for 2018 and subsequent years. Is there anything else?
Certainly. We have not yet mentioned the programme related to electromobility, namely the plans to build a prototype and set up production, which gained a lot of publicity last year and which will gain even more in 2018. I must admit that we, the Polish Motor Group, are actively participating in it. Most companies look for their place in the new reality on their own, while we - as a group of Polish producers - support one of the project teams participating in the competition organised by ElectroMobility Poland (EMP). And so, in January, the project team CURIE+, in cooperation with the Polish Motor Group, applied for a subsidy for the construction of the first Polish electric car CURIE+. Our member companies have knowledge, experience, potential and background in the scope of production, technical and technological support for such a project. This is why we have got companies from the Polish Motor Group as well as several companies not associated with our organisation all interested in cooperation. It is a pity that such a short period and small budget have been provided - these factors constitute, in our opinion, the greatest two risks to this project. Therefore, the final decision on our involvement will be made once the project team completes the detailed assumptions for the construction of specific components of the vehicle, which will most probably be in February or March 2018 at the earliest.
Another issue is the opportunity that has been created for the Polish motor sector and which stems from major interest in our country on the part of foreign concerns investing in Poland. It would be good if Polish companies benefited from various means of support, subsidies for research and development. We should seek to develop solutions, technologies and products that, irrespective of recommendations and temporary needs of international car concerns, would themselves constitute a major commercial value, also outside of the borders of our country, which is important and which is already happening in fact, judging by the wide offer of promotions and fairs dedicated to the domestic motor sector and organised by governmental units. The interest in Polish products and services is growing systematically and such support will surely contribute to the success - of each of us individually and the entire country, Poland.
Thank you for your time.
The Polish Motor Group in 2017
- according to Bartosz Mielecki, Director of the PMG:
- In November 2017, the Polish Motor Group celebrated the first anniversary of its existence. For the association it was a year of intense work, which included:
Polish Motor Group (PMG) is the first Polish organisation associating exclusively domestic producers from this sector. Its mission constitutes increasing the strength of Polish companies in contacts with distributors and producers of cars, which will contribute to boosting interest and at the same time the share of Polish producers of motor spare parts in the market of products. The PMG also actively promotes Polish companies among foreign partners. The main aim of the association constitutes creating conditions favouring the development of Polish motor sector companies. This is implemented by, among other things, initiating cooperation between companies, getting to know each other, organising economic missions and purchase groups, as well as speaking for Polish companies in front of public administration. PMG propagates an idea that the quality of motor parts manufactured by Polish companies is not worse than that of the well-known brands of foreign products.
Adam Sikorski - founder and president of the Polish Motor Group association. Co-founder of UNIMOT Capital Group (1992), being one of the largest private companies on the Polish energy market (since March 2017, UNIMOT S.A. has been listed on the main market of the Warsaw Stock Exchange). In 2012 he was appointed the chairperson of the supervisory board and main shareholder of PZL Sędziszów S.A. - a leading Polish producer of filters for the motor sector, and in 2015 he became the president of the management board of this Company. He completed Executive MBA post-graduate studies and in 2013 received a title of Executive Doctor of Business Administration - EDBA in the Institute of Economic Sciences of the Polish Academy of Sciences in Warsaw. He is also a graduate of the faculty of International Business Relations of the Polonia University in Częstochowa.