The Czech Republic has become a country with per capita production of cars in the world in the last thirty years. 2024 10 million residents had a record year with more than 1.4 million manufactured vehicles in the country. This is an increase of about 4% year-on-year.
However, the production fell to 7.1% in the first quarter of 2025.
The main reason for this was the decline in demand in the West, which started with the problem in the European Automotive industry, slow infection for electromobility, and US taffs.
Meanwhile, the country’s weapon industry is booming.
“Defense industry can become a new engine of checks and European economy,” Danas Nerudova, a member of the European Parliament Committee on the budget, told DW.
“It can use free supply capacity and workforce by motor vehicle sector, promote economic growth and strengthen our safety at the same time.”
Weapon as new economic engine?
In Brussels, a Czech economist and advisor of the European Economic and Social Committee is somewhat and more doubtful, somewhat and more doubtful. “Czech arms factory factories are experiencing golden times, it is true,” he told DW.
Nevertheless, he says that he does not believe that weapons will transform the automotive sector into a new engine of the check economy.
“I do not want to see arms production instead of commercial production,” said.
Prior to the First World War, the area of today’s Czech Republic was known as the center of arms production. For decades, the erstwhile-Cycoslovakia is one of the leading weapons of the world. For years, the ARMS was responsible for about 10% of all Czechoslovacian exports.
Therefore, domestic demand was run by a heavy armed forces of several hundred thousand men by the end of the 1980s.
However, the end of Warsaw Pact – a defense treaty and military alliance between the Soviet Union and the seven Eastern Block Socialist Republics in 1955 – as well as in the early 1990s, with a significant decrease in the military budget, along with a significant decrease in the military budget, along with a hit to the Czech Arms manufacturer, as well as in the general disorder.
Czechoslovakia’s last major Armament Order was in an export contract for 250 T72 tanks in Syria in 1991.
Then, in 1992, Czechoslovakia divided into two individual states, Czech Republic and Slovakia. This led to a division of the defense industry. The production of tanks and heavy machinery was mainly in Slovakia, while the aircraft industries, small arms, ammunition, production of radar systems and, at the top, small arms were mainly located in the Czech Republic.
Completely successful success bristers, decreased check defense spending for 1% of the country’s GDP, as well as only 20.000 soldiers, commercialization for only 20.000 soldiers and Downsing made the check defense significantly weakened in the years after partition.
Growth factor was Ukraine
After Russia’s invasion of Ukraine in February 2022, the factors of the Czech arms increased their production on a large scale. In particular, modernization of tanks, and production of ammunition, military vehicles, self-propelled artillery digestion, drone, radar equipment and machine guns have been booming since then.
40% production of check arms factories goes to Ukraine, where joint enterprises have also been installed.
Overall, up to 90% of check-made arms are exported. At the same time, the check army is increasing in the purchase.
In 2024, the check defense spending reached 2% of the country’s GDP and the Prime Minister of Czech, Petra Fiala announced that in a few years, it would be an amount of 3%.
New jobs for motor vehicle employees
The boom is ready to continue for the next few years. This year, ammunition manufacturer STV group will increase its production of large-caliber artillery ammunition, which mainly supplies up to 300,000 from 100,000 units to Ukraine. The Czech PBS group plans to double the production of engines for missiles and drones.
In return, the number of employees in these companies is increasing. The STV group plans to appoint 1,000 additional employees in the near future. According to its annual report, the Czechoslovak group, the largest check arms manufacturer, which included the Tatra military car plant as well as the ammunition production, already appointed 14,000 people.
Comparatively, the largest automotive group Skoda-Auto Mlada employs about 20,000 people in its main plans in Mlada Boleslav. However, as low demand production of electric cars will reduce the number of employees in the future, Skoda Auto Boss Claus Zelmer told the German print magazine Automobilwocha at the end of February 2025 that his company, which currently employs 41,000 people, is planning to reduce its workforce by 15%.
Many of these employees are expected to get new jobs in the defense business. Agreements for check recruitment agencies, when they switch to industries, will not require any major retrening.
This article was adapted from German.
