Industry Association Predicts Massive Slovak Car Production Boost

The Slovak factories of Volkswagen, PSA/Peugeot-Citroen and Kia will probably boost production 12 percent this year as foreign demand has revived, the Association of the Slovak Automotive Industry said.

The automakers could assemble a record 630,000 vehicles this year, compared with 561,993 cars in 2010, the industry association said.

PSA and Volkswagen have announced plans to expand production in the eastern European country, attracted by its euro-area membership and labor costs lower than in the West.

VW builds the VW Touareg, the Audi Q7 and complete car bodies for the Porsche Cayenne premium SUVs, in Bratislava. PSA produces the Peugeot 207 and Citroen C3 Picasso subcompacts models in Trnava. Kia's plant in Zilina builds three versions of the Cee'd compact car and the Sportage and Hyundai ix35 SUVs.

Slovakia in the previous decade became a regional hub for carmaking industry as manufacturers followed their customers in setting up plants in the country. Automotive companies accounted for 37% of total industrial sales last year, according to the association.