Implementation of Renault in Slovenia - Cross Culture

Thèmes abordés

Renault - Cross - Cultural - Marketing - Slovenia - Management - Businnes - Industry

Résumé du document

The entry of the PECO in the European Union in May 2004 showed with the rest of the world that there is a lot of opportunities for the companies in this zone of the world. However, the process of industrialization and opening towards the foreigner and in particular towards the countries of Western Europe is not so recent, since 1972, Renault concluded an agreement with the factory Revoz of Novo Mesto (60 km in the South-east of Slovenia) in order to be established in the East.

We are indeed leaning on the precise case of Slovenia, because in fact the country made a success of best its economic transition and whose model approaches best from now on that of the countries of Western Europe. Which were the difficulties encountered by the company at the time of this delocalization? Which were the advantages and the disadvantages of the latter, and how it is brought to evolve/move?

We will study these problems in three points: first of all, we will be interested in the context in which Renault was established as Slovenia, then we will see the characteristics of this establishment, and finally we will consider the future prospects for the company in Eastern Europe. First of all, before studying the French establishments as Slovenia, it is necessary to specify the content of the trade which the two countries maintain.

In fact, since 1996, France is the third supplier of Slovenia after Germany and Italy (nearly 1 billion Euros in 2003, is a share of market for our exports of 10, 04%). Among the Eastern European countries, in spite of her small size, Slovenia is the third customer of France behind Poland and Russia, and our fifth trade partner in Central Europe. France, as for it, became the fourth customer of Slovenia. In 1998, exports were about 7, 1 billion Francs whereas the imports of France coming from Slovenia were 5, 2 billion Francs. The trade balance was then surplus 1; 8 billion is a cover rate of 136%. It will be noted that compared to 1997, the sales of France increased by 22%.

Extraits

[...] However, the establishment of Renault as Slovenia had consequences on local companies. The operators of the zone are still economically fragile, but with the development of the abstract garages and the showrooms, one attends the rise to power of traditional dealers. The persons in charge for the strategy of Renault stress that there is a model of transition which is on the way of the success. Renault is not solely as Slovenia to earn money, but also to what is called support at Renault durable growth” Development perspectives The French manufacturer projects to invest 100 million Euros in his factory of Novo Mesto, as Slovenia to carry the output to 200.000 cars per annum and to manufacture there since 2006, replacing it of Twingo. [...]

[...] Coursat, director of Revoz, for the review Slovenian Business Carry forward, this one evoked several weak points concerning the factory which it directs. Particularly, it raised two precise handicaps. On the one hand, one of the most important problems is the rise of the wages which appears too much high compared to the rise of the productivity. In addition, the second negative point underlined by B. Coursat is that of the production costs which remain still too high in comparison with the other factories of the group installed in the PECO. [...]

[...] That gives meetings where the Slovenians hold of the speeches in charge of forty year and set language of self-management; where the translator pains, translates word for word, and where the French director ( ) await, await, await “This known as, these cultural dissensions seem to be surmounted today. III. Futures perspectives 1. Consequences of Renault implementation in Slovenia Consequences of the delocalization for France The delocalizations of production at Renault caused sharp debates on the macroeconomic consequences in France with short and medium term. The delocalizations were often regarded as persons in charge for a crawling unemployment. [...]

[...] It is advisable to analyze the choice of this investment. If the advantage of the cost of labour should grow blurred from here at a few years, because of a correction of the standard of living, the prospects for growth seem perennial. The rate of equipment in Eastern Europe east of 50% lower than that noted in Western Europe. In addition, the renewal of the park, whose average age rises at 13 years in Western Europe), should also dope the sales in the years to come. [...]

[...] But Renault will know several vexations. Initially, its subsidiary company will suffer from the war in ex-Yugoslavia bus when Renault settled; it counted on a market of 22 million the Yugoslavians. But, with the war, the market was reduced to 2 million Slovenians or more precisely to a market of 65.000 vehicles per annum all confused marks. The subsidiary company of Renault was thus obliged to orientate differently its marketing towards Western Europe. This has constrained its subsidiary company to build in 1993 a new factory to the European standards to produce of Clio's. [...]