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Yet Another Car Industry Giant Chooses Lithuania

December 06, 2017

This year, Kaunas received news about the arrival of two road and car component manufacturing companies. Hella and Continental are building factories in Kaunas Free Economic Zone (EFZ), and now a third company has announced plans to open a plant in Lithuania. Al-Ko Vehicle Technology is to open a research and development centre.

Al-Ko, a prominent German corporation, is well known for manufacturing gardening, ventilation and conditioning technology and car and trailer components..

Al-Ko Vehicle Technology, which manufactures chassis components for commercial , tourist trailers as well as for lightweight commercial transport, intends to open a research and product development centre in Lithuania. By setting foot in Lithuania, the industry giant is frank in saying that the move will allow it to assess Lithuania’s potential.

The plans of the corporation were revealed to by Frank Sager, senior research and development vice-president of Al-Ko. The corporation’s 51-year-old vice-president has previously worked for Bosch GmbH, Daimler AG, Mannesmann VDO AG and Tower Automotive Holding among others.

Discovering  Lithuania

“The first reason why we are moving from Germany is the supply of specialist engineers in software electronics,” Mr. Sager said. A number of large car manufacturers are currently actively looking for such specialists. The shortage is exacerbated by automated management technology that is being developed on a broad scale and which requires extensive creative resources.

“At first, we were considering Romania since we have a plant there. However, the market there was limited. We could have continued our search in Asia but we immediately refused to go in this direction because of the distance, visas and other circumstances encumbering daily operations,” the senior vice-president of Al-Ko revealed. The field of the search was narrowed down to European countries and the state signatories to the Schengen agreement. This is how the German corporation discovered Lithuania.

“The research laboratory needs a high-speed internet connection, highly skilled employees to develop new solutions and the internet of things – Lithuania, I guess, is in this aspect an advanced country,” he said.  I am constantly surprised at people’s friendliness and desire to help. We received considerable assistance from Invest Lithuania – both when drawing up plans and when carrying out research. KTU (Kaunas University of Technology) is a wonderful source of educated people. We find the factor of the Schengen area particularly important, as well as the fact that people here speak fluent English. The only thing missing is better air communications, especially the possibility to travel direct from Munich or Frankfurt to Kaunas,” Mr. Sager said of a problem that is common to a number of entrepreneurs.

Local Leadership

Initially, Al-Ko will work with a small team and a small budget in Lithuania; in January 2018, Kaunas should have six or seven engineers in place here, all from Lithuania. Mr. Sager claimed that there were no plans to employ foreign workers in Kaunas: “My extensive 25-year experience in the area of research and development management shows that the best head of a team is a local specialist. When entering a new country it is very important to have a local manager to head the team. The local leader will establish contacts with local universities much easier and faster, and will also better understand workers’ needs and existing procedures. For this reason, we knew from the very beginning that the managers of the office would be local specialists.”

At first a small team of electronics engineers will come to Kaunas to prepare the laboratory and train the staff. Before starting work the new specialists from Lithuania will be trained in Germany. The company aims to employ about 30 specialists within the next three years.

Mr. Sager said that no connection between the research centre and local businesses was planned. However, just like all businessmen trying Lithuania’s potential, he did not rule out such plans in the future.

Improvement of Products

The centre in Kaunas will be one of several research and development units operating in Europe, specializing in electronics and software.

“We will also focus on electronics and software in other centres, but Kaunas will be the core centre of this area of specialisation. I have no doubt that soon we will have a very strong team here,” he said optimistically.

The laboratory in Kaunas will develop and improve several electric-mechanical products – equipment for car trailers that will inhibit resonance swaying, and also electric gears for tourist trailers.

The first system is an integral part of the safety equipment used in connecting a modern car and trailer. This equipment prevents the resonance swaying of the trailer, which is often a reason for car accidents. Al-Ko sells over 20,000 such systems annually. At present the equipment is designed solely for car trailers but there are plans to offer equipment for commercial transport in the future as well.

The second system ensures the possibility of maneuvering with a trailer without keeping it attached to a car. It is controlled remotely and it is possible to maneuver the trailer, for instance, on a camping site, without using a car. Such equipment is especially popular with users of travel trailers because such trailers can weigh from 500 kg to 2,000 kg thus making them difficult to move without the use of a car. Al-Ko offers a semi-automated and fully automated version of the equipment.

To Depend on Fortune

Will the industry giant limit itself to a research and development centre in Kaunas? Mr. Sager responds that they have a few future scenarios, but at the moment the company is taking its first step and will see how it goes. Further steps can be promoted by positive results, he added.

“We have plants in Australia, Germany, Austria, Great Britain, France, Italy, Spain and Romania, and I see no reason why we can’t produce in Lithuania too. In the meantime, we only plan to set up a research centre here,” the vice-president of Al-Ko said.

Source: Verslo žinios

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