Apollo Tyres finds skills short­age in Hun­gary a chal­lenge

The Pak Banker - - COMPANIES/BOSS -

Apollo Tyres, which is build­ing a half-a-bil­lion-euro fac­tory in east­ern Hun­gary, says it is hav­ing dif­fi­culty find­ing staff, re­flect­ing a wider prob­lem for for­eign in­vestors in Hun­gary.

The coun­try is seen as an at­trac­tive base in Europe for man­u­fac­tur­ers be­cause wages are rel­a­tively cheap. But a brain drain as skilled work­ers have left for more lu­cra­tive pay pack­ets in other parts of the Euro­pean Union or else­where has lim­ited the pool of avail­able labour.

"The peo­ple with sev­eral years of ex­pe­ri­ence that you could read­ily hire are just not there in the labour mar­ket for now," said Ti­bor Banyai, Head of Hu­man Re­sources at Apollo Tyres Hun­gary.

In­dia's No. 2 tyre maker has pre­vi­ously said that pro­duc­ing in Hun­gary will make it much more cost com­pet­i­tive to sell in the United States.

It also hopes to sup­ply tyres to car­mak­ers in Europe such as Volk­swa­gen, Daim­ler and Suzuki Mo­tor Corp that build cars close to the Hun­gary plant.

Banyai said he was op­ti­mistic the Hun­gar­ian plant could open on sched­ule next Jan­uary with the help of "at­trac­tive" wages of­fered to work­ers, but did not dis­close de­tails.

While wages in Hun­gary re­main low rel­a­tive to coun­tries in western Europe, they rose 4% in De­cem­ber from a year ear­lier, ac­cord­ing to the lat­est of­fi­cial fig­ures, re­flect­ing the skills short­age.

Apollo is giv­ing its work­ers ex­tra train­ing in both Hun­gary and In­dia and is spend­ing "bil­lions" of forints to get its work­force up to speed to run the fac­tory, said Banyai.

"There are cer­tain jobs, which are dif­fi­cult to fill," he said.

"It is very hard to find a prod­uct in­dus­tri­al­i­sa­tion ex­pert with a back­ground in tyre man­u­fac­tur­ing," he said. "You can count th­ese peo­ple on the fin­gers of your hands."

The com­pany has been able to fill most tech­ni­cian jobs from the re­gion around the east­ern town of Gy­ongyos so far, but it has cast a wider net for en­gi­neers, look­ing to hire peo­ple from re­mote ar­eas, Banyai said.

He said he would not poach from ri­val tyre mak­ers Bridge­stone and Hankook Tire, which also have plants in Hun­gary.

Apollo, which is mak­ing one of Hun­gary's big­gest green­field in­vest­ments of re­cent years, has also re­ceived a 606 mil­lion forint ($2.2 mln) train­ing sub­sidy from Hun­gary's govern­ment.

While Vik­tor Or­ban's govern­ment has rat­tled banks and tele­com com­pa­nies with un­ortho­dox new taxes, it is keen to at­tract man­u­fac­tur­ers.

Hun­gary's econ­omy is grow­ing by nearly 3% this year, bet­ter than many other coun­tries in Europe, but for­eign di­rect in­vest­ment fell to 1.4 bil­lion euros last year, from nearly 1.7 bil­lion euros in 2014, ac­cord­ing to of­fi­cial fig­ures.

Apollo's hir­ing prob­lems high­light fur­ther risks to in­vest­ment.

"The mar­ket has be­come more dif­fi­cult. While last year it was eas­ier to hire fresh grad­u­ate tech­ni­cians, we can now hire fewer of them from the re­gion," Banyai said.

"They have dif­fer­ent plans than last year's class. Many want to learn dif­fer­ent jobs, get a univer­sity de­gree and many stu­dents plan to go abroad." -

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