Poland pulled into CEE's Daimler car chase

Poland pulled into CEE's Daimler car chase
Daimler is not the first company to spark a car chase in CEE.
By bne IntelliNews March 18, 2016

Poland is being pulled into the chase for Daimler's planned factory in Central and Eastern Europe. The German automotive company has put Poland and Hungary onto a short list as potential locations for a new €800mn engine factory, a Polish newspaper reported on March 18.

The report from Puls Biznesu adds fuel to the fire of speculation on the plant’s location, resembling the race whipped up amongst CEE countries last year to host a €1.3bn plant for Jaguar Land Rover. The report that Poland is amongst the candidates follows claims that Daimler is eyeing Hungary, Romania, Russia and Slovakia. The Polish report claims that Slovakia, which eventually won the JLR investment, has now fallen out of the running.

The Mercedes-Benz building appears to have done its best to add to the confusion. The German press quotes a Mercedes executive as hinting that a second investment in a car factory is up for grabs, while Daimler CEO Dieter Zetsche has hinted Romania is on the list.

In Poland, Daimler is reported to be eyeing the south-western town of Jawor. The site is the same one offered to JLR, Puls Biznesu writes.

Warsaw is apparently using the British marque's positive opinion of Jawor to market the location to Daimler. Consultants are joining the effort, calling Jawor a unique location.

“Poland does not have a sufficient number of large enough plots. We should learn from the Czechs and the Hungarians how to prepare such areas,” Tomasz Olszewski of real estate broker Jones Lang LaSalle told the newspaper.

Officially, however, there is no confirmation from Germany that any investments are planned in the CEE, let alone if any particular countries are being looked at as locations. The Polish government and foreign investment agency also remain tight lipped.

That is likely the result of reports that Polish claims last year that the country was about to clinch the JLR deal upset the Indian-owned carmaker. Officials in Warsaw claimed at the time, however, that Poland simply couldn't compete with the huge package of incentives offered by Bratislava.

Hungary will be happy to hear that it remains on the shortlist. Daimler acquired a 441-hectare plot in the country in 2008, of which it currently uses only 160 hectares. The company originally planned to to use the remaining area to build a second plant to double potential capacity to 300,000 units, but that was derailed by the financial crisis. Since 2012 Damiler has been suggesting it will look again at the plan.

Meanwhile, the German press claims Russia is now out of the running. Zetsche said in January that the carmaker planned a new plant in the country, but that has now reportedly changed because there are no signs of imminent recovery in the economy.