Services and client experience
The brands and models manufactured in Slovakia are well sold in the markets, and innovation in the supplier space will be key for the future success in a highly competitive market.
Industry 4.0, Internet of Things, Big Data, Digital Factory, Smart Manufacturing – topics that are constantly being discussed in the automotive industry. But how to start with Digital Transformation? How important is it for us? Is our IT ready for such a change? Are we effective when implementing such solutions? Am I ready for the risks of the digital world?
Štefan Čupil, Director, Risk Assurance Services and Information Technology
PwC has helped several manufacturing companies to analyse their current status, to develop a reasonable target model and how to get there using a proven methodology - Digital Maturity Assessment. Thanks to a close internal co-operation PwC team is able to connect the business process, financial and legal requirements and current technology capabilities, not omitting the Risk Assessment, Information Security and General Data Protection Regulations.
PwC performed an IT Costs Review for a major automotive manufacturer, which made the IT financing more transparent and assisted in the optimization of its IT planning process to ensure the appropriate business case calculations.
Our team was able to define requirements for a new IT system and assisted with the IT System Selection for a large company in manufacturing industry. With our professional Project Assurance service, we helped to ensure the successful implementation of the system according to customer’s specific requirements and needs.
The key objective of operational managers is to meet the company’s profitability and growth objectives, and, ideally, go beyond the everyday requirements and create a competitive advantage. Therefore, operational managers need to increase sales, improve operational effectiveness and transform the business.
Pavel Dvornák, Director, Company Transformation and Operational Excellence
Our client was incurring high operational costs during manufacturing and faced strong competition. We were asked to evaluate the issues, perform a business assessment of critical operational areas (incl. planning, manufacturing, maintenance and logistics). After the review, we created a transformation plan with management which included specific solutions and savings targets. The client wants our team to continue to support the implementation to accelerate growth and increase profitability. During the implementation phase (80% of our project), we worked hand in hand with the clients’ employees to achieve successful change management, ensure the sustainability of changes, and obtain buy in from operational staff.
As a result of assisting our clients in a business transformation in Slovakia, the client achieved 20% productivity growth. Thanks to improved labour utilisation and improvements to the manufacturing processes, the company achieved cost reductions of EUR 3.1 million and was ranked the second most productive company in the industry in the European market. The duration of the project was ten months. As a result of our assistance, another company involved in plastic material development and manufacturing increased the effectiveness of its sales department. They achieved rapid sales growth resulting in overall 15% growth. The duration of the project was nine months.
Due to ongoing economic growth and recent significant investments and demographic effects, many automotive companies are affected by major changes on the labour market: lack of skilled employees, strong competition for experienced specialists, increasing salary costs, rising recruitment costs and retention issues. Companies need to reassess how they attract and recruit new employees, reconsider their employment and bonus policy, and pay more attention to recognition and work / life balance.
Ľudmila Guerin, Manager, Human Resources Services
PwC has helped a client to improve the labour situation in its central warehouse. PwC provided the following HR services: A compensation survey analysing the market position taking into consideration compensation packages and benefits. A detailed location study identifying relevant workforce supply in a radius of 30 km from the location. In addition, typical transport routes and travel conditions were analysed. Based on the results of these services, our client was able to adjust the compensation packages and to better attract more employees, to identify locations with the right workforce and better target potential hires.
In Slovakia, investment incentives are available from the Slovak state budget and from EU funds. Thanks to these funds, companies are able to receive financial support for building new operations, extending or diversifying of production, or increasing innovation potential. However, application procedures and respective requirements are complex.
Lenka Bartoňová, Senior Manager, Investment and State Aid
We assisted our client to select the most suitable financial support measure (investment incentives or ESIF funded measure) to enlarge its business activities. We advised the investor which of the supported regions in Slovakia could be the most suitable for the planned investment taking into account legislative criteria applicable for different regions. Based on an investment budget we calculated state aid and its split into tax credit, job subsidies and cash grant to maximise possible incentive. We advised the investor also during the implementation phase of the project, e.g. changing of investment parameters as regards job creation, reach of the minimum amount of investment on time in order not to lose provided aid. We helped our client to fulfil reporting obligations and ensure communication with the Slovak authorities.
We have helped our clients receiving investment incentives for their investment projects totalling EUR 2.2 billion. From this, the approved amount of contributions totalled EUR 362.8 million which is 23% of the total volume of subsidies granted in Slovakia. As a result of these investment projects, 6,167 new jobs were created.
Import duties constitute barriers to cross-border trade. There are specific customs duty schemes which allow one-off and long-term customs duty reductions, in some cases to zero. Specific possibilities of duty relief are available for the automotive industry, which allow exemptions from import duty on input raw-material, components, materials and production lines
Dmytro Myroshnychenko, Manager, Customs Specialist
For several of our automotive clients, we prepared comprehensive solutions and selected the most appropriate customs duty scheme, or a combination of several schemes, to achieve the maximum, long-term benefit as regards customs relief. Our aim was to identify possible customs duty savings and to minimise risks from improper application of the customs law. The PwC team consists of customs specialists with long-term experience working with the Slovak customs authorities. We closely monitor daily updates to the extensive customs agenda in Brussels, which is governed by European regulations and which is difficult for companies to keep abreast of. It is important to keep in mind that appointing an external customs representative, i.e. a haulier, will not relieve an organisation from its liability regarding any breach of the customs regulations.
Over the past five years, we have helped our clients to save more than 10 million euros in customs duties. We have successfully provided our services to more than 40% of companies ranked in the top hundred automotive companies.
Due to the popularity of social media, easy access to information, reviews and opinions, customers are increasingly well informed and ever more demanding. Car dealerships have to respond to this situation by exploring new areas to find and attract potential customers and by anticipating customers’ needs and providing them with personalised offers for products they are searching for.
Jens Hörning, Partner, Slovakia and CEE Automotive Leader
We were asked by a car dealer to improve sales efficiency and better target his marketing activities. Using internal company data, we started with a prediction of customer needs at every stage of the life cycle: marketing, purchase and aftersales. We also made use of a wide range of external geographical and demographic data sources that PwC collects, processes and analyses. We matched these data sources together to create an extensive database about customers and markets. As a result, we were able to advise our client, where their existing and potential clients are located, what is their driving pattern (how often, where and when they drive), where they shop, sizes and structure of company’s car fleets, etc.
After implementation of the program and management‘s refocused marketing strategy, the car dealer was able to increase the efficiency of its marketing campaigns by 20%, the frequency of client contact and visits by 15%, car sales by 5 – 10% and attraction of new clients by 5 – 10%.